Question
Tanner-UNF Corporation acquired as a long-term investment $700,000 of 8% bonds, dated Jan 1. The market interest rate (yield) was 10% for bonds of similar
Tanner-UNF Corporation acquired as a long-term investment $700,000 of 8% bonds, dated Jan 1. The market interest rate (yield) was 10% for bonds of similar risk and maturity. Tanner-UNF paid $ 455,350 for the bonds. The company will receive interest semiannually on June 30 and December 31. Company management has classified the bonds as available-for-sale investments. As a result of changing market conditions, the fair value of the bonds at December 31, 2018, was $350.000. What is the amount related to the bonds that Tanner-UNF will report in its statement of cash flows for the year ended Dec 31, 2015 ?
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