On July 1, 2020, Sarasota Aggregates Ltd. purchased 7% bonds having a maturity value of $130,000 for $134,563. The bonds provide the bondholders with a 6% yield. The bonds mature four years later, on July 1, 2024, with interest receivable June 30 and December 31 of each year. Sarasota uses the effective interest method to allocate unamortized discount or premium. The bonds are accounted for using the FV-OCI model with recycling. Sarasota has a calendar year end. The fair value of the bonds at December 31, 2020 and 2021, was $134,283 and $132,891, respectively. Assume fair value adjustments are recorded at year end only. Immediately after collecting interest on December 31, 2021, the bonds were sold for $132,891.

Schedule of Interest Revenue and Bond Premium Amortization Effective-Interest Method Interest Revenue Premium Amortized Date Cash Received Amortized Cost of E July 1. 2020 $ 134 Dec. 31, 2020 $ $ $ June 30, 2021 Dec. 31, 2021 ate Account Titles and Explanation Debit Credit 31, 2020 Cash FV-OCI Investments Interest Income (To record collection of interest) FV-OCI Investments Unrealized Gain or Loss-OCI (To record fair value adjustment) 21 Cash FV-OCI Investments Interest Income (To record collection of interest) 31, 2021 Cash FV-OCI Investments Interest Income (To record collection of interest) ollowing the three-step approach, prepare the journal entries for the sale of the bond on December 31, 2021. Include the classification of unrealized gains and losses to net income. (Credit account titles are automatically indented when the amount is ntered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts. Round nswers to decimal places, e.g. 5,275.) Account Titles and Explanation Debit Credit Unrealized Gain or Loss-OCI FV-OCI Investments (To record fair value adjustment to date of disposal) Cash 132891 FV-OCI Investments 132891 (To record disposal of the bond) Loss on Disposal of Investments - FV-OCI Unrealized Gain or Loss - OCI (To reclassify accumulated unrealized gains and losses from OCI to net income)