Tanner$-$UNF Corporation acquired as a long$-$term investment $$250$ million of $8\%$ bonds, dated July $1,$ on July $1,2024.$ Company management has classified the bonds as an available$-$for$-$sale investment. The market interest rate $($yield$)$ was $10\%$ for bonds of similar risk and maturity. Tanner$-$UNF paid $$210$ 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 $$220$ million.

Required:

$1.$ & $2.$ Prepare the journal entry to record Tanner$-$UNF$$s investment in the bonds on July $1,2024$ and interest on December $31,2024,$ at the effective $($market$)$ rate.

$3.$ Prepare any additional journal entry necessary for Tanner$-$UNF to report its investment in the December $31,2024,$ balance sheet.

$4.$ Suppose Moody$$s bond rating agency downgraded the risk rating of the bonds motivating Tanner$-$UNF to sell the investment on January $2,2025,$ for $$200$ million. Prepare the journal entries necessary to record the sale, including updating the fair$-$value adjustment, recording any reclassification adjustment, and recording the sale.