On March 25, 2021, Phillips Corporation purchased bonds of Atlas Corporation for $132 million and classified the securities as trading securities. On December 31, 2021, these bonds were valued at $150 million. Three months later, on April 3, 2022, Phillips Corporation sold these bonds for $140 million. As part of the multi-step approach to record the 2019 transaction, Phillips Corporation should first update the fair value adjustment by recording:A. An unrealized holding gain of $28 million in 2019.B. A unrealized holding loss of $10 million in 2019.C. An unrealized holding gain of $8 million in 2019.D. A gain of $8 million in 2019.

By December 31, 2021, the bonds were worth $150 million, resulting in an $18 million unrealized gain. By the time the bonds were sold, their price had deceased to $140 million, which means that $10 million of the $18 million previous gain had been erased. Therefore, the adjusting entry on December 31, 2022, should include the $10 million unrealized loss.

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