Tanner-UNF Corporation acquired as a long-term investment $360 million of 70% bonds, dated July 1, on July 1 2021. Company management has the positive intent and ability to hold the bonds until maturity. The market interest rate (yield) was 8% for bonds of similar risk and maturity. Tanner-UNF paid $320.0 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, 2021, was $330.0 million. Required: 1. & 2. Prepare the journal entry to record Tanner-UNF's Investment in the bonds on July 1, 2021 and interest on December 31, 2021, at the effective (market) rate. 3. At what amount will Tanner-UNF report its investment in the December 31, 2021, 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, 2022, for $310.0 million. Prepare the journal entry to record the sale. Req 1 and 2 Reg 3 Reg 4 Prepare the journal entry to record Tanner-UNF's Investment in the bonds on July 1, 2021 and interest on December 31, 2021, at the effective market) rate. (If no entry is required for a transaction/event, select "No journal entry required in the first account held. Enter your answers in millions rounded to 1 decimal place, (.e., 5,500,000 should be entered as 5.5).) View transaction list Journal entry worksheet Record Tanner-UNF's Investment in the bonds on July 1, 2021. Note: Enter debits before credits Date General Journal Debit Credit July 01, 2021 Investment in bonds 360.0 Discount on bond investment Record entry Clear entry View general Journal Reg 1 and 2 Reg 3 Reg 4 At what amount will Tanner-UNF report its investment in the December 31, 2021, balance sheet? (Enter your answer in milions rounded to 1 decimal place, (.e., 5,500,000 should be entered as 5.5).) Investment million Req 1 and 2 Req3 Reg 4 Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2022, for $310.0 milion. 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 1 decimal place (I.e., 5,500,000 should be entered as 5.5).) Show less View transaction list Journal entry worksheet 1 2 Prepare any journal entry needed to adjust the investment to fair value. Note: Enter debits before credits Date General Journal Debit Credit January 02, 2022
