Business, 22.05.2020 21:59 deisyy101

Tanner-UNF Corporation acquired as a long-term investment $310 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 9% for bonds of similar risk and maturity. Tanner-UNF 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, 2021, was $290 million.

How would this investment be classified on Tanner-UNF's balance sheet?

A. Held-to-maturity securities
B. Other securities
C. Significant-influence investments
D. Trading securities
E. Available-for-sale securities

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Tanner-UNF Corporation acquired as a long-term investment $310 million of 6% bonds, dated July 1, on...

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