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Investment in Debt Securities Available for Sale

9 Months Ended

Sep. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Investment in Debt Securities Available for Sale

Note 6. Investment in Debt Securities Available for Sale

Investments in debt securities available for sale with a fair value of $7,985,886 as of December 31, 2019 consisted of corporate debt securities. These investments are valued at estimated fair value, with unrealized gains and losses reported as a separate component of stockholders’ equity in accumulated other comprehensive loss. The Company only had investments in cash and cash equivalents at September 30, 2020.

Investments in debt securities available for sale are evaluated periodically to determine whether a decline in their value is other than temporary. The term “other than temporary” is not intended to indicate a permanent decline in value. Rather, it means that the prospects for near term recovery of value are not necessarily favorable, or that there is a lack of evidence to support fair values equal to, or greater than, the carrying value of the security. Management reviews criteria such as the magnitude and duration of the decline, as well as the reasons for the decline, to predict whether the loss in value is other than temporary. Once a decline in value is determined to be other than temporary, the value of the security is reduced and a corresponding charge to earnings is recognized.

A summary of the cost, fair value and maturities of the Company’s short-term investments is as follows:

		September 30, 2020								December 31, 2019
		Cost				Fair Value				Cost				Fair Value
Short-term investments
Investments in debt securities		$	-			$	-			$	7,943,108			$	7,985,886
Total		$	-			$	-			$	7,943,108			$	7,985,886

		September 30, 2020								December 31, 2019
		Cost				Fair Value				Cost				Fair Value
Short-term investment maturities
Within 3 months		$	-			$	-			$	7,943,108			$	7,985,886
Total		$	-			$	-			$	7,943,108			$	7,985,886

The following table shows the Company’s investment securities gross unrealized gains (losses) and fair value by investment category and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2020 and December 31, 2019. The Company has reviewed individual securities to determine whether a decline in fair value below the amortizable cost basis is other than temporary.

		September 30, 2020								December 31, 2019
Available for sale securities (all unrealized holding gains and losses are less than 12 months at date of measurement)		Fair Value				Unrealized Holding Gains				Fair Value				Unrealized Holding Gains

Investments in debt securities with unrealized Gains		$	-			$	-			$	7,985,886			$	42,778
Total		$	-			$	-			$	7,985,886			$	42,778

Investment income, which includes net realized gains on sales of available for sale securities and investment income interest and dividends, is summarized as follows:

		Three Months Ended September 30,
		2020				2019
Interest and dividends accrued and paid		$	2,857			$	116,371
Realized gains			7,257				58,068
Investment income, net		$	10,114			$	174,439

		Nine Months Ended September 30,
		2020				2019
Interest and dividends accrued and paid		$	66,029			$	364,414
Realized gains			53,354				68,418
Investment income, net		$	119,383			$	432,832