The following selected transactions relate to investment activities of Ornamental Insulation Corporation during 2018. The company buys debt securities, intending to profit from short-term differences...

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The following selected transactions relate to investment activities of Ornamental Insulation Corporation during 2018. The company<br>buys debt securities, intending to profit from short-term differences in price and maintaining them in an active trading portfolio.<br>Ornamental's fiscal year ends on December 31. No investments were held by Ornamental on December 31, 2017.<br>Mar. 31 Acquired 8% Distribution Transformers Corporation bonds costing $500, e00 at face value.<br>Sep. 1 Acquired $1,200,000 of American Instruments' 10% bonds at face value.<br>Sep. 30 Received semiannual interest payment on the Distribution Transformers bonds.<br>Oct.<br>2 Sold the Distribution Transformers bonds for $575,000.<br>Nov. 1 Purchased $1,90e,000 of M&D Corporation 6% bonds at face value.<br>Dec. 31 Recorded any necessary adjusting entry(s) relating to the investments. The market prices of the investments are:<br>$1,160,000<br>$1,970, 000<br>American Instruments bonds<br>M&D Corporation bonds<br>(Hint: Interest must be accrued.)<br>Required:<br>1. Prepare the appropriate journal entry for each transaction or event during 2018, as well as any adjusting entries necessary at year<br>end.<br>2. Indicate any amounts that Ornamental Insulation would report in its 2018 income statement, 2018 statement of comprehensive<br>income, and 12/31/2018 balance sheet as a result of these investments.<br>

Extracted text: The following selected transactions relate to investment activities of Ornamental Insulation Corporation during 2018. The company buys debt securities, intending to profit from short-term differences in price and maintaining them in an active trading portfolio. Ornamental's 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 $500, e00 at face value. Sep. 1 Acquired $1,200,000 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 $575,000. Nov. 1 Purchased $1,90e,000 of M&D Corporation 6% bonds at face value. Dec. 31 Recorded any necessary adjusting entry(s) relating to the investments. The market prices of the investments are: $1,160,000 $1,970, 000 American Instruments bonds M&D Corporation bonds (Hint: Interest must be accrued.) Required: 1. Prepare the appropriate journal entry for each transaction or event during 2018, as well as any adjusting entries necessary at year end. 2. Indicate any amounts that Ornamental Insulation would report in its 2018 income statement, 2018 statement of comprehensive income, and 12/31/2018 balance sheet as a result of these investments.
Indicate any amounts that Ornamental Insulation would report in its 2018 income statement, 2018 statement of<br>comprehensive income, and 12/31/2018 balance sheet as a result of these investments. (Amounts to be deducted shoul<br>indicated with a minus sign.)<br>Income statement:<br>79,000<br>75,000<br>Interest revenue<br>Gain on trading securities<br>Net income<br>2$<br>154,000<br>Statement of comprehensive income:<br>Net income<br>Investment in M&D Corporation bonds<br>75,000<br>Balance sheet:<br>Assets<br>Current Assets<br>Interest receivable<br>24<br>19,000<br>

Extracted text: 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. (Amounts to be deducted shoul indicated with a minus sign.) Income statement: 79,000 75,000 Interest revenue Gain on trading securities Net income 2$ 154,000 Statement of comprehensive income: Net income Investment in M&D Corporation bonds 75,000 Balance sheet: Assets Current Assets Interest receivable 24 19,000
Jun 10, 2022
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