Mills Corporation acquired as a long$-$term investment $$200$ million of $7\%$ bonds, dated July $1,$ on July $1,2024.$ Company management has classified the bonds as an available$-$for$-$sale investment. The market interest rate $($yield$)$ was $5\%$ for bonds of similar risk and maturity. Mills paid $$240$ 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 $$210$ million.

Required:

& $2.$ 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.

At what amount will Mills report its investment in the December $31,2024,$ balance sheet?

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 $$250$ million. Prepare the journal entries required on the date of sale.