The following selected transactions relate to investment activities of Ornamental Insulation Corporation during 2018. The company buys debt securities, not intending to profit from short-term differences in price and not necessarily to hold debt securities to maturity, but to have them available for sale when circumstances warrant. Ornamentals fiscal year ends on December 31. No investments were held by Ornamental on December 31, 2017.

Mar.		31		Acquired 8% Distribution Transformers Corporation bonds costing $480,000 at face value.
Sep.		1		Acquired $1,020,000 of American Instruments 10% bonds at face value.
Sep.		30		Received semiannual interest payment on the Distribution Transformers bonds.
Oct.		2		Sold the Distribution Transformers bonds for $513,000.
Nov.		1		Purchased $1,480,000 of M&D Corporation 6% bonds costing at face value.
Dec.		31		Recorded any necessary adjusting entry(s) relating to the investments. The market prices of the investments are:

American Instruments bonds	$	962,000
M&D Corporation bonds	$	1,548,000

(Hint: Interest must be accrued.) Required: 1. Prepare the appropriate journal entry for each transaction or event during 2018, as well as any adjusting entries necessary at year end. For any sales, prepare entries to update the fair-value adjustment, record any reclassification adjustment, and record the sale.

2. Indicate any amounts that Ornamental Insulation would report in its 2018 income statement, 2018 statement of comprehensive income, and 12/31/2018 balance sheet as a result of these investments.

March 31, 2018 Investment in Distribution Transformers bonds 480,000 Cash 480,000 2 1,020,000 September 01, 201 Investment in American Instruments bonds Cash 1,020,000 3 September 30, 201 Cash 19,200 Investment revenue 19,200 October 02, 2018 Cash 513,000 X Investment in Distribution Transformers bonds 480,000 > 33,000 Gain on sale of investments 1,480,000 November 01, 2018 Investment in M&D Corporation bonds Cash 1,480,000 9 48,800 X December 31, 2018 Interest receivable t receivable Interest revenue 48,800 X 10 10,000 December 31, 2018 Fair value adjustment Unrealized holding gainOCI 10,000