Marvin Corporation issued $$505,000$ of $6\%,10-$year bonds for $96$ on January $1,$ Year $1.$ Interest is payable annually on December $31.$ The company uses the straight$-$line method to amortize bond discounts and premiums.

a$)$ Prepare the liabilities section of the balance sheet at December $31,$ Year $1.$

b$)$ Determine the amount of interest expense reported on the Year $1$ income statement

c$)$ Prepare the operating activities section of the Year $1$ statement of cash flows