Exercise 12-6 (Algo) Trading securities [LO12-1, 12-3] Mills Corporation acquired as an investment $235 million of 8% bonds, dated July 1, on July 1, 2024 Company management is holding the bonds in its trading portfolio. The market interest rate (yield) was 6% for bonds of similar risk and maturity. Mills paid $270 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, 2024, was $260 million. Required: 1. & 2. Prepare the journal entry to record Mills' investment in the bonds on July 1, 2024 and interest on December 31, 2024, at the effective (market) rate. 3. Prepare the journal entry by Mills to record any fair value adjustment necessary for the year ended December 31, 2024, 4. Suppose Moody's bond rating agency upgraded the risk rating of the bonds, and Mills decided to sell the investment on January 2 2025, for $280 million. Prepare the journal entries required on the date of sale. Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 and and Req 3 Req 4 Prepare the Req 1 and 2 to record Mills' investment in the bonds on July 1, 2024 and interest on December 31, 2024, at the effective (market) rate. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place, (ie., 5,500,000 should be entered as 5.5). Show less Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 Req 4 Prepare the journal entry to record Mills' investment in the bonds on July 1, 2024 and interest on December 31, 2024, at the effective (market) rate. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place, (.e., 5,500,000 should be entered as 5.5). No Date 1 July 01, 2024 Investment in bonds Premium on bond investment Cashi 2 December 31, 2024 Cash General Journal Premium on bond investment Interest revenue Req 3 > Show less A Debit Credit 235.00 35.0 270.0 9.4 1.3 81 2025, 101 $200 11. Prepare the journal enues required on the date of sale. Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3. Req 4 Prepare the journal entry by Mills to record any fair value adjustment necessary for the year ended December 31, 2024. Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field. Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place, (i.e. 5,500,000 should be entered as 5.5). No 1 Date General Journal December 31, 202 Loss on investment (unrealized, NI) Fair value adjustment < Req 1 and 2 Req 4 > Show lessA Debit Credit 25.0 25.0