Tanner-UNF Corporation acquired as a long-term investment $150 million of 4% bonds, dated July 1, on July 1, 2018, Company management has the positive intent and ability to hold the bonds until maturity, but when the bonds were acquired Tanner-UNF decided to elect the fair value option for accounting for its investment. The market interest rate (yield) was 6% for bonds of similar risk and maturity. Tanner-UNF paid $120 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, 2018, was $130 million. Required 1. How would this investment be classified on Tanner-UNF's balance sheet? 2. to 4. Prepare the journal entry to record Tanner-UNF's investment in the bonds on July 1, 2018, interest on December 31, 2018, at the effective rate and fair value changes as of December 31, 2018 5. At what amount will Tanner-UNF report its investment in the December 31, 2018, balance sheet? 6. Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2019, for $100 million. Prepare the journal entry to record the sale. Req 1 Req 2 to 4 Req 5 Req 6 Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2019, for $100 million. Prepare the journal entry to record the sale. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50).) Show lessA Event General Journal Debit Credit Cash Loss on sale of investments Discount on bond investment 100.00 20.60 29.40 Investment in bonds 150.00 Unrealized holding loss-oCl 9.40 Fair value adjustment 9.40 Req 5 Req 6 Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2019, for $100 million. Prepare the journal entry to record the sale. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50).) Show lessA View transaction list Journal entry worksheet 2 Record the entry to adjust to fair value on the date of sale Note: Enter debits before credits Event General Journal Debit Credit 100.00 20.60 29.40 Cash oss on sale of investments iscount on bond investment Investment in bonds 150.00 Record entry Clear entry View general journal Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2019, for $100 million. Prepare the journal entry to record the sale. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50).) Show lessA View transaction list Journal entry worksheet 0 Record the sale of the bonds on January 2, 2019. Note: Enter debits before credits. Event General Journal Debit Credit Unrealized holding loss-oCI 9.40 Fair value adjustment 9.40 Record entry Clear entry View general journal