File Edit View Go Tools Window Help 2020 ACCT2ge 2 of 6)-Edited Q Search Q3. On April 1, 2018, Kenney Inc. purchased $120,000 of six percent bonds for $124,725. At this price the bonds will have an effective yield to maturity of 5%. Interest is paid semi- annually on March 31 and September 30. The fair value of the bonds on December 31, 2018 was $122,000 plus accrued interest. Required: (a) Prepare all required journal entries for 2018 (Kenney has a December 31 year-end) assuming that Kenney intends to hold the bonds to maturity and uses the Amortized Cost method. Amortization is recorded when interest payments are received by the effective interest method (round to the nearest dollar) and at the end of the fiscal period. (7 marks) (b) The bonds are sold on April 1, 2019 for $123,600 (assume accrued interest is nil). Prepare all entries required to properly record the bond transactions in 2019. (5 marks) (c) Prepare all required entries for 2018 assuming instead that Kenney uses the Fair Value - Net Income method to record the Investment in Bonds (6 marks)