wi Saved Tanner-UNF Corporation acquired as a long-term investment $200 million of 6% bonds, dated July 1, on July 1, 20

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Wi Saved Tanner Unf Corporation Acquired As A Long Term Investment 200 Million Of 6 Bonds Dated July 1 On July 1 20 1 (77.16 KiB) Viewed 35 times

Wi Saved Tanner Unf Corporation Acquired As A Long Term Investment 200 Million Of 6 Bonds Dated July 1 On July 1 20 2 (16.43 KiB) Viewed 35 times

wi Saved Tanner-UNF Corporation acquired as a long-term investment $200 million of 6% bonds, dated July 1, on July 1, 2021. 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 8% for bonds of similar and maturity. Tanner-UNF paid $170 million for the bonds. The company will receive interest semiannually on June 30 and Decem 31. As a result of changing market conditions, the fair value of the bonds at December 31, 2021, was $180 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, 2021, interest on December 31, 2021, a the effective (market) and fair value changes as of December 31, 2021. 5. At what amount will Tanner-UNF report its investment in the December 31, 2021, balance sheet? 6. Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment or January 2, 2022, for $150 million. Prepare the journal entries to record the sale. Complete this question by entering your answers in the tabs below. 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, 2022, for $150 million. Prepare the journal entries 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 (.e., 5,500,000 should be entered as 5.50).) Show less A ***** View transaction list View journal entry worksheet Tel No General Journal Debit Credit 1 2 Cash Discount on bond investment Fair value adjustment Transaction 1 2 < Prev 7 of 10 20.00 150,00 39.88 10.20 Next >
No 1 2 Transaction 1 2 General Journal Cash Discount on bond investment Fair value adjustment Investment in bonds 0033 Debit 20.00 X 150.00 39.88 x 10.20 Credit 200.00