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Sun Company purchased as a short-term investment $300,000 of 10% bonds, dated July 1, on...

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Accounting

Sun Company purchased as a short-term investment $300,000 of 10% bonds, dated July 1, on July 1, 2021. Management intends to include the investment in a short-term, active trading portfolio. For bonds of similar risk and maturity the market yield was 11%. The price paid for the bonds was $276,000. Interest is received semiannually on June 30 and December 31. Due to changing market conditions, the fair value of the bonds at December 31,2021, was $280,000. Answer the following questions:

1. At what amount will Sun report this investment in the December 31, 2021 balance sheet?

2.What is the amount related to the bond investment that Sun will report in its income statement for the year ended December 31,2021?(Ignore income taxes.) 3.What is the amount related to the bond investment that Sun will report in its statement of cash flows for the year ended December 31,2021? Indicate the category in which to classify cash flows.

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