Zeta Ltd issues loan notes of €65,000 on 1 January 2032. Redemption is to take place on equal terms, four years later. The company decides to put aside an equal amount to be invested at 3.5% which will provide €65,000 on maturity. Tables show that €0.238227 invested annually will produce €1 in four years’ time.

Required: (a) Prepare the loan-note redemption reserve account. (b) Create the sinking fund investment account. (c) Set up the loan-notes account. (d) Provide extracts from the retained earnings and cash flow statement.