Required:
1. & 2. Prepare the journal entry to record Tanner-UNF's investment in the bonds on July 1, 2024 and interest on December 31, 2024, at the effective (market) rate.
3. At what amount will Tanner-UNF report its investment in the December 31, 2024, 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, 2025, for $280.0 million. Prepare the journal entry to record the sale.
Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2025, for $280.0 million. Prepare the journal entry to record the sale.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).
No Date General Journal Debit Credit
1 January 02, 2025 No journal entry required
2 January 02, 2025 Cash 280.0
Loss on investments (NI) 12.3
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