SMT HAD BAD DIRECTIONAL GYROSCOPE AND AN INTERMITTENT MODE C.

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THE ACFT WAS JUST OUT OF MAINT FOR A BAD ALTERNATOR THE DAY BEFORE. PRE TKOF CHKS WERE NORMAL AND I LINED THE ACFT UP ON RWY 10L AND SET MY BUG SO I COULD MAINTAIN RWY HDG AFTER TKOF (THIS WAS MY CLRNC). AFTER TKOF I WAS ASKED TO TURN TO 260 DEGS. I SET MY BUG AND LET THE AUTOPLT TAKE ME AROUND TO 260 DEGS. I WAS THEN ASKED TO TURN TO 060 DEGS AND INTERCEPT MY AIRWAY. I SET THE BUG TO 060 DEGS AND DEP TOLD ME I WAS FLYING 120 DEGS. MY HSI AND RMI SHOWED 060 DEGS. I TURNED MY WINDSHIELD HEAT OFF AND USED MY MAGNETIC COMPASS TO GET ON COURSE AND CHKED THE VOR RADIAL. I SLAVED THE HSI BACK TO WHERE IT SHOULD HAVE BEEN AND I INTERCEPTED THE AIRWAY. THE HSI WOULD NOT STAY LINED UP AND WOULD PRECESS AROUND AS SOON AS I SET IT. I WENT TO MY #2 VOR AND MAGNETIC HDG AS WELL AS THE RMI (PROPER RADIAL AND VOR INFO WAS BEING INDICATED). I ELECTED TO CONTINUE TO MY DEST AT MSO AS IT WAS VFR AND AS SOON AS I GOT THE OPPORTUNITY TO CANCEL IFR I DID SO. I ALSO HAD A TRANSPONDER THAT WAS ACTING UP ON DEP BUT SOMEWAY OR OTHER STARTED OPERATING PROPERLY IN ABOUT THE FIRST 10 MINS OF FLT. I DID ALL PROPER PREFLT CHKS AND BELIEVE I CHOSE THE BEST OPTION TO GO TO VFR AND LAND AT MY DEST WHEN THE PROBLEM WAS FOUND. AFTER DEP POINTED OUT THE PROBLEM I HAD NO FURTHER PROBLEMS AS I WAS AWARE OF THE SITUATION AND USED MY BACKUP SYS.