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QWERTY company acquired as a long-term investment $270 million of 8% bonds, dated July 1, on...

QWERTY company acquired as a long-term investment $270 million of 8% bonds, dated July 1, on July 1, 2018. QWERTY company determined that it should account for the bonds as an available-for-sale investment. The market interest rate was 6%. QWERTY company paid $310 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, 2018, was $290 million.

Directions:
1 and 2: Prepare the journal entry to record QWERTY company's investment in the bonds on July 1, 2018 and interest on December 31, 2018, at the effective (market) rate.
3: At what amount will QWERTY company report its investment in the December 31, 2018, balance sheet?
4: Suppose that due to risk, QWERTY company decided to sell the investment on January 2, 2019, for $320 million. Prepare the journal entries to record the sale.

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