Working Notes Please to understand. Thanks

MBS Corporation acquired as long-term investment $200 million of 10% bond, dated July 1, on Jul 1, 2018. The market interest rate (yield) was 16% for bonds of similar risk and maturity. MBS paid $180 million for the bonds. The company will receive interest semiannually on June 30 and December 31. Company management is holding the bonds in its trading portfolio. As a result of changing market condition, the fair value of the bonds at December 31, 2018, was $182 million. Required; 1. Prepare journal entry to record MBS's investment in the bonds on July 1, 2018. Journal Entry - July 1, 2018 2. Prepare the journal entries by MBS to record interest on December 31, 2018, at the effective (market) rate. Journal Entry - December 31, 2018 3. Prepare additional journal entry necessary for MBS to report its investment in the December 31, balance sheet. Journal Entry - December 31, 2018 4. Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating MBS to sell the investment on January 2, 2109, for $ 187 million. Prepare the journal entry to record the sale. 1) Updating the fair-value adjustment: Journal Entry - January 2, 2019 2) Recording the sale transaction: Journal Entry - January 2, 2019