The following selected transactions relate to investmentactivities of Ornamental Insulation Corporation during 2021. Thecompany buys equity securities as noncurrent investments. None ofOrnamental’s investments are large enough to exert significantinfluence on the investee. Ornamental’s fiscal year ends onDecember 31. No investments were held by Ornamental on December 31,2020.
| Mar. | | 31 | | Acquired Distribution Transformers Corporation common stock for$590,000. |
| Sep. | | 1 | | Acquired $1,185,000 of American Instruments' common stock. |
| Sep. | | 30 | | Received a $20,650 dividend on the Distribution Transformerscommon stock. |
| Oct. | | 2 | | Sold the Distribution Transformers common stock for$634,000. |
| Nov. | | 1 | | Purchased $1,590,000 of M&D Corporation common stock. |
| Dec. | | 31 | | Recorded any necessary adjusting entry(s) relating to theinvestments. The market prices of the investments are: |
| | | |
| American Instruments common stock | $ | 1,116,000 | |
| M&D Corporation common stock | $ | 1,669,000 | |
|
Required:
1. Prepare the appropriate journal entry for eachtransaction or event during 2021, as well as any adjusting entriesnecessary at year-end.
2. Indicate any amounts that Ornamental Insulationwould report in its 2021 income statement, 2021 statement ofcomprehensive income, and 12/31/2021 balance sheet as a result ofthese investments. Include totals for net income, comprehensiveincome, and retained earnings as a result of these investments.
