A company acquired as a long-term investment $260 million of 7.0% bonds, dated July 1, on July 1, Year 1, Company management has the positive intent and ability to hold the bonds until maturity. The market interest rate (yield) was 9% for bonds of similar risk and maturity. The company paid $220.0 million for the bonds. The company will receive interest semiannually on June 30 and December 31. As a result of changing market conditions, the fair value of the bonds at December 31 , Year 1 , was $240.0 million. Required: 1. \& 2. Prepare the journal entry to record the company's investment in the bonds on July 1, Year 1 and interest on December 31 , Year 1. at the effective (market) rate. 3. At what amount will the company report its investment in the December 31 , Year 1 , balance sheet? 4. Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating the company to sell the investment on January 2, Year 2, for $220.0 million, Prepare the journal entry to record the sale