NOTE: I have already completed the journal entries. I need the income statement. Also, notice that some variables in the income statement have already been filled in. I have provided the problem in case you need it.

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. 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 $440,000 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 $485,000.
Nov.		1		Purchased $1,600,000 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:

American Instruments bonds	$	974,000
M&D Corporation bonds	$	1,664,000

(Hint: Interest must be accrued.)

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.

Correct Journal Entries:

This is the income statement that needs to be filled in:

Prepare the appropriate journal entry for each transaction or event during 2018, as well as any adjusting entries necessary at year end. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Date Debit Credit 1 March 31, 2018 General Journal Investment in Distribution Transformers bonds Cash 440,000 440,000 2 1,020,000 September 01, 201 Investment in American Instruments bonds Cash 1,020,000 3 17,600 September 30, 201 Cash Interest revenue 17,600 4 45,000 October 02, 2018 Fair value adjustment Unrealized holding gainNI 45,000 5 485,000 October 02, 2018 Cash Investment in Distribution Transformers bonds Fair value adjustment OOO 440,000 45,000 1,600,000 November 01, 2018 Investment in M&D Corporation bonds Cash 1,600,000 7 34,000 December 31, 2018 Interest receivable Interest revenue 34,000 8 16,000 December 31, 2018 Interest receivable Interest revenue 16,000 9 18,000 December 31, 2018 Fair value adjustment Unrealized holding gainNI 18,000 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 should be indicated with a minus sign.) Income statement: Interest revenue Gain on trading securities $ 67,600 0 $ 67,600 > 0 Net income Statement of comprehensive income: Net income Other comprehensive income Comprehensive income Balance sheet: Assets Current Assets Interest receivable 0 0 Investments Trading securities - amortized cost Add: Fair value adjustment Shareholders' Equity Retained earnings 18,000 $ 18,000