Mercer Corporation acquired $$400,000$ of Park Company$$s bonds on June $30,2018,$ for $$409,991\mathrm{.}12.$ The bonds carry a $12\%$ stated interest rate and pay interest semiannually on June $30$ and December $31.$ The appropriate market interest rate is $11\%,$ and the bonds are due June $30,2021.$

Required:

$1.$ Prepare an investment interest income and premium amortization schedule, using the:

a$.$ straight$-$line method

b$.$ effective interest method

$2.$ Prepare journal entries to record the December $31,2018,$ and December $31,2020,$ interest receipts using both methods.