The following information relates to Starr Company’s investment in available-for-sale bonds for 2019:
Jan. 1 Purchased $30,000 face value of Bradford Company 8% bonds for $29,100. The market rate of interest is 10%, and interest on the bonds is payable each June 30 and December 31.
1 Purchased $40,000 face value of Morris Company 10% bonds for $40,400. The market rate of interest is 9.8%, and interest on the bonds is payable each June 30 and December 31.
June 30 Collected the interest and the following information is available:

Security ............................................Fair Value
Bradford Company 8% ...................$29,160
Morris Company 10% ......................40,800

July 1 Purchased $25,000 face value of Whipple Corporation 11% bonds for $23,000. The market rate of interest is 12%, and interest on the bonds is payable each June 30 and December 31.
Nov. 30 Sold the Whipple bonds for $22,750 plus accrued interest.
Dec. 31 Starr collected the interest, sold the Morris bonds for $40,800, and the following information is also available:

Security .....................................................Fair Value
Bradford Company 8% bonds ................$28,800

Required:
1. Prepare journal entries to record the previous information for 2019. Use the effective interest method and round all amounts to the nearest dollar. Assume that Starr prepares semiannual financial statements.
2. Show the items of income or loss from investment transactions that Starr reports for each 2019 semiannual income statement.
3. Show how the investment items are reported on each of the 2019 semiannual balance sheets, assuming that management expects to dispose of all investments within one year of purchase.