At December 31, 2020, the investments in the portfolio of the trading securities of Mac Company included the following:

Atlanta Corp. bonds, 5%, $100,000 face value, purchased on Oct. 1, 2020 at par

Dallas Inc. bonds, 4%, $50,000 face value, purchased on July 1, 2020 at par

Required:

1. Record the receipt of quarterly interest from the Atlanta Corp. bonds on December 31, 2020.
2. Record the receipt of semiannual interest from the Dallas Inc. bonds on December 31, 2020.
3. Record the entry to adjust the bonds to fair value on December 31, 2020. The fair value of the Atlanta Corp. bonds and the Dallas In bonds on December 31, 2020, were $110,000 and $45,000 respectively.
4. Record the entry to sell the Atlanta Corporation bonds on January 2, 2021, for $112,500.
5. Record the entry to sell the Dallas Inc. bonds on January 3, 2021 for $44,500.
6. Adjust the Fair Value Adjustment account on December 31, 2021 to reflect that no trading securities are owned (if necessary).

7. Assume INSTEAD that the above bonds are held as available-for-sale investments. if we assume the bonds are AFS Securities, not Trading Securities. if the accounting for the transaction should change, write the complete corrected journal entry.