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Mills Corporation acquired as a long$-$term investment $$240$ million of $8\%$ bonds, dated July $1,$ on July $1,2024.$ Company management

has classified the bonds as an available$-$for$-$sale investment. The market interest rate $($yield$)$ was $6\%$ for bonds of similar risk and

maturity. Mills paid $$280$ 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 $31,2024,$ was $$265$ million.

Required:

& $2.$ Prepare the journal entry to record Mills' investment in the bonds on July $1,2024$ and interest on December $31,2024,$ at the

effective $($market$)$ rate.

At what amount will Mills report its investment in the December $31,2024,$ balance sheet?

Suppose Moody's bond rating agency upgraded the risk rating of the bonds, and Mills decided to sell the investment on January $2,$

$2025,$ for $$292$ million. Prepare the journal entries required on the date of sale.

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Req $1$ and $2$

Req $3$

Req $4$

Suppose Moody's bond rating agency upgraded the risk rating of the bonds, and Mills decided to sell the investment on

January $2,2025,$ for $$292$ million. Prepare the journal entries required on the date of 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

$5\mathrm{.}5.$

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