On January $1,$ Year $1,$ Young Company issued bonds with a face value of $$128,000,$ a stated rate of interest of $12$ percent, and a $10-$year term to maturity. Interest is payable in cash on December $31$ of each year. The effective rate of interest was $11$ percent at the time the bonds were issued. The bonds sold for $$135,538.$ Young used the effective interest rate method to amortize the bond premium.

Required

a$.$ Determine the amount of the premium on the day of issue.

b$.$ Determine the amount of interest expense recognized on December $31,$ Year $1.$

c$.$ Determine the carrying value of the bond liability on December $31,$ Year $1.$

d$.$ Provide the general journal entry necessary to record the December $31,$ Year $1,$ interest expense.