A company invests in stock of other companies for trading purposes. Its accounting year ends December 31. Its investment activity during 2019, 2020, and 2021 is as follows:
•Purchased stock of Acme Company in 2019 for $250,000. Sold the investment later in 2019 for $235,000.
•Purchased stock of Beeber Company in 2019 for $300,000. The investment had a fair value of $275,000 at the end of 2019. It was sold for $310,000 in 2020.
•Purchased stock of Cromwell Company in 2019 for $500,000. Its fair value and the end of 2019 and 2020 was $520,000 and $460,000, respectively. The investment was sold for $480,000 in 2021.
Required
Prepare the journal entries necessary to report the above events. For recorded gains and losses, indicate whether they are reported in OCI or in income.

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The Answer of A company invests in stock of other companies for trading purposes. Its accounting year ends December 31. Its investment activity during 2019, 2020, and 2021 is as follows:
•Purchased stock of Acme Company in 2019 for $250,000. Sold the investment later in 2019 for $235,000.
•Purchased stock of Beeber Company in 2019 for $300,000. The investment had a fair value of $275,000 at the end of 2019. It was sold for $310,000 in 2020.
•Purchased stock of Cromwell Company in 2019 for $500,000. Its fair value and the end of 2019 and 2020 was $520,000 and $460,000, respectively. The investment was sold for $480,000 in 2021.
Required
Prepare the journal entries necessary to report the above events. For recorded gains and losses, indicate whether they are reported in OCI or in income.

A Company Invests in Stock of Other Companies for Trading