Gassy Stores sells $$400,000$ of $12\%$ bonds on June $1,2022.$ The bonds pay

interest on December $1$ and June $1.$ The due date of the bonds is June $1,2026.$

The market rate of similar investments is $10\%.$ On December $1,2024,$ Gassy

Stores retired the bond for $$400,000.$ The company closes its books on

December $31.$

Requirements: $($Show all workings$)$

I. Calculate the proceeds from the sale of the bond. Clearly show the

amount of the premium or discount and state two reasons which support

the premium or discount calculated. $(4\mathrm{.}25$ marks$)$

II$.$ Prepare a bond amortization schedule for the bond$$s life $(10\mathrm{.}75$ marks$)$

III. Prepare all the journal entries for $2022,2023$ & $2024(22$ marks$)$