Upsilon Ltd issues loan notes of £75,000 on 1 January 2045. Redemption is to take place on equal terms, four years later. The company decides to put aside an equal amount to be invested at 5% which will provide £75,000 on maturity. Tables show that £0.232012 invested annually will produce £1 in four years’ time.

Required:

1. Prepare the loan-note redemption reserve account.
2. Create the sinking fund investment account.
3. Set up the loan-notes account.
4. Extracts from the retained profits account.