On January 1, 2021, Labtech Circuits borrowed $260,000 from First Bank by issuing a three-year, 9% note, payable on December 31 2023 Labtech wanted to hedge the risk that general Interest rates will decite, causing the fair value of its debt to whicrease Therefore, Labtech entered into a three-year interest rate swap agreement on January 1 2021, and designated the swap as a fair value hedge The agreement called for the company to receive payment based on an 9% fixed Interest rate on a notional amount of $260.000 and to pay interest based on a floating interest rate tied to LIBOR. The contract called for cash settlement of the net interest amount on December 31 of each year Floating (LIBOR settlement rates were 9% at inception and 10%, 8% and 8% at the end of 2021, 2022, and 2023, respectively. The late values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: 2021 2002 Han value of interest rate swap Fair value of not payable 2021 5259) $25,41 December 11 2022 32253 SS $260.000 Required: 1. Calculate the net cash settlement at the end of 2021.2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance on the note. Interest and necessary adjustments for changes in to value 3. Prepare the jouma entries during 2022 to record interese nel cos interest rettlement for the interest rate swap and necessary odustments for changes in fair value 4. Prepare the journal entres during 2023 to record interes not cach interest rettlement for the interest rate swap necessary adjustments for changes in fair value and repayment of the debe 5. Calculate the book values of both the swap account and the note th teach of the three years 6. Cocote the net effect on emings of the hedging arrangement of the tree years ignore income taxes 2. Supon the fair value of the note of December 31 202 nad Been S24700ottner han $255.84 with the additional decline in fair e due to meto porceations that the creditworthineta och wongHow would that affect your des to record Cene la volues? cumplete this question by entering your answers in the tabs below. Egid RIBE Roccare FAUNA . Regere out! values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: Banuary 1 2021 2023 December 2022 52535 $ 262, 535 2021 8,359) 3255, 541 ar value of interest rate swap var value of note payable 326, 5260,00 Required: Calculate the net cash settlement at the end of 2021, 2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance of the note. Interest, and necessary adjustments for changes in fale Value 3. Prepare the journal entries during 2022 to record interest, net cash interest settlement for the Interest rate swap, and necessary adjustments for changes in fair value 4. Prepare the journal entries during 2023 to record interest, net cash interest settlement for the Interest rate swap necessary adjustments for changes in fair value and repayment of the debt 5. Calculote the book values of both the swap account and the note in each of the three years 6. Calculate the net effect on earnings of the hedging arrangement in each of the three years, (ignore income taxes) 7. Suppose the fall value of the note at December 31, 2021, had been $247000 rather than $256,641 with the additional decline in fair valoe due to mvestors' perceptions that the creditworthiness of Laptech was worsening. How would that affect your enres to record changes in the far values? Complete this question by entering your answers in the tabs below. Heid Required Paquired Required Required Required Blattnet settlement at the end of 2021 2022 and 2023 gabendamine ca 23 2020 CERERE On January 1, 2021. Labtech Circuits borrowed $260,000 from First Bank by issuing three year, 9% note, payable on December 31, 2023 Labtech wanted to hedge the risk that general interest rates will decline, causing the fair value of its debt to increase. Therefore, Labtech entered into a three year interest rate swap agreement on January 1, 2021, and designated the swap as a fair value hedge. The agreement called for the company to receive payment based on an 9% fixed interest rate on a notional amount of $260,000 and to pay interest based on a floating interest rate tied to UBOR. The contract called for cash settlement of the net interest amount on December 31 of each year Floating (4.BOR) settlement rates were 9% at inception and 10%, 8%, and 8% at the end of 2021 2022 and 2023, respectively. The fait values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: Fair value of Interest rate swap Yip value of note payable January 1 2021 0 $260,000 2021 (3,359) 5256,641 December 31 2022 32,535 $262.535 5 $260.000 Required: 1. Calculate the net cash settlement at the end of 2021 2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance of the note interest and necessary adjustments for changes in fair value 3. Prepare the journal entries during 2022 to record interest.net cash interest settlement for the interest rate swap and necessary adjustments for changes in fair value 4. Prepare the journal entries during 2023 to record interest net cash interest Settlement for the interest rate-swap, necessary adjustment for changes in fair value and repayment of the debt 5. Calculate the book values of both the swap account and the note in each of the three years 6. Calculate the net effect on earnings of the hedging arrangement in each of the three years. (lonore income taxes.) 7. Suppose the fair value of the note at December 31, 2021, had been $247000 rather than $256,641 with the additional decline in fair Vue due to mesto perceptions that the creditworthiness of Labtech was worsening How would that affect your entries to record changes in the four vi? Complete this question by entering your answers in the tabs below. Next On January 1, 2021, Labtech Circuits borrowed $260,000 from First Bank by issuing a three-year, 9% note, payable on December 31, 2023. Labtech wanted to hedge the risk that general interest rates will decline, causing the fair value of its debt to increase. Therefore, Labtech entered into a three-year interest rate swap agreement on January 1, 2021, and designated the swap as a fair value hedge The agreement called for the company to receive paymegt based on an 9% fixed interest rate on a notional amount of $260,000 and to pay interest based on a floating interest rate tied to LIBOR. The contract called for cash settlement of the net interest amount on December 31 of each year: Floating (LIBOR) settlement rates were 9% at inception and 10%, 8%, and 8% at the end of 2021 2022 and 2023, respectively. The fair values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: December 31 Tair value of Interest rate swap Fair value of note payable January 1 2021 0 $260.000 2021 5. (3,359) 5256, 641 $2,535 $262.535 2023 $ 0 5260,000 Required: 1. Calculate the net cash settlement at the end of 2021 2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance of the note, interest and necessary adjustments for changes in fair value 3. Prepare the journal entries during 2022 to record interest, net cash interest settlement for the interest rate swap, and necessary adjustments for changes in fair value 4. Prepare the journal entries during 2023 to record interest net cash interest settlement for the Interest rate swap, necessary adjustments for changes in fair value, and repayment of the debt 5. Calculate the book values of both the swap account and the note in each of the three years 6. Calculate the net effect on earnings of the hedging arrangement in each of the three years, dgnore Income taxes.) 7. Suppose the fale value of the note at December 31, 2021, had been 5247000 rather than $256,641 with the additional decline in fair value to investors' perceptions that the creditworthiness of Labtech was worsening How would that affect your entries to record Complete this question by entering your answers in the tabs below. Prev Na On January 1, 2021, Labtech Circuits borrowed $260,000 from First Bank by issuing a three-year, 9% note, payable on December 31 2023 Labtech wanted to hedge the risk that general Interest rates will decite, causing the fair value of its debt to whicrease Therefore, Labtech entered into a three-year interest rate swap agreement on January 1 2021, and designated the swap as a fair value hedge The agreement called for the company to receive payment based on an 9% fixed Interest rate on a notional amount of $260.000 and to pay interest based on a floating interest rate tied to LIBOR. The contract called for cash settlement of the net interest amount on December 31 of each year Floating (LIBOR settlement rates were 9% at inception and 10%, 8% and 8% at the end of 2021, 2022, and 2023, respectively. The late values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: 2021 2002 Han value of interest rate swap Fair value of not payable 2021 5259) $25,41 December 11 2022 32253 SS $260.000 Required: 1. Calculate the net cash settlement at the end of 2021.2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance on the note. Interest and necessary adjustments for changes in to value 3. Prepare the jouma entries during 2022 to record interese nel cos interest rettlement for the interest rate swap and necessary odustments for changes in fair value 4. Prepare the journal entres during 2023 to record interes not cach interest rettlement for the interest rate swap necessary adjustments for changes in fair value and repayment of the debe 5. Calculate the book values of both the swap account and the note th teach of the three years 6. Cocote the net effect on emings of the hedging arrangement of the tree years ignore income taxes 2. Supon the fair value of the note of December 31 202 nad Been S24700ottner han $255.84 with the additional decline in fair e due to meto porceations that the creditworthineta och wongHow would that affect your des to record Cene la volues? cumplete this question by entering your answers in the tabs below. Egid RIBE Roccare FAUNA . Regere out! values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: Banuary 1 2021 2023 December 2022 52535 $ 262, 535 2021 8,359) 3255, 541 ar value of interest rate swap var value of note payable 326, 5260,00 Required: Calculate the net cash settlement at the end of 2021, 2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance of the note. Interest, and necessary adjustments for changes in fale Value 3. Prepare the journal entries during 2022 to record interest, net cash interest settlement for the Interest rate swap, and necessary adjustments for changes in fair value 4. Prepare the journal entries during 2023 to record interest, net cash interest settlement for the Interest rate swap necessary adjustments for changes in fair value and repayment of the debt 5. Calculote the book values of both the swap account and the note in each of the three years 6. Calculate the net effect on earnings of the hedging arrangement in each of the three years, (ignore income taxes) 7. Suppose the fall value of the note at December 31, 2021, had been $247000 rather than $256,641 with the additional decline in fair valoe due to mvestors' perceptions that the creditworthiness of Laptech was worsening. How would that affect your enres to record changes in the far values? Complete this question by entering your answers in the tabs below. Heid Required Paquired Required Required Required Blattnet settlement at the end of 2021 2022 and 2023 gabendamine ca 23 2020 CERERE On January 1, 2021. Labtech Circuits borrowed $260,000 from First Bank by issuing three year, 9% note, payable on December 31, 2023 Labtech wanted to hedge the risk that general interest rates will decline, causing the fair value of its debt to increase. Therefore, Labtech entered into a three year interest rate swap agreement on January 1, 2021, and designated the swap as a fair value hedge. The agreement called for the company to receive payment based on an 9% fixed interest rate on a notional amount of $260,000 and to pay interest based on a floating interest rate tied to UBOR. The contract called for cash settlement of the net interest amount on December 31 of each year Floating (4.BOR) settlement rates were 9% at inception and 10%, 8%, and 8% at the end of 2021 2022 and 2023, respectively. The fait values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: Fair value of Interest rate swap Yip value of note payable January 1 2021 0 $260,000 2021 (3,359) 5256,641 December 31 2022 32,535 $262.535 5 $260.000 Required: 1. Calculate the net cash settlement at the end of 2021 2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance of the note interest and necessary adjustments for changes in fair value 3. Prepare the journal entries during 2022 to record interest.net cash interest settlement for the interest rate swap and necessary adjustments for changes in fair value 4. Prepare the journal entries during 2023 to record interest net cash interest Settlement for the interest rate-swap, necessary adjustment for changes in fair value and repayment of the debt 5. Calculate the book values of both the swap account and the note in each of the three years 6. Calculate the net effect on earnings of the hedging arrangement in each of the three years. (lonore income taxes.) 7. Suppose the fair value of the note at December 31, 2021, had been $247000 rather than $256,641 with the additional decline in fair Vue due to mesto perceptions that the creditworthiness of Labtech was worsening How would that affect your entries to record changes in the four vi? Complete this question by entering your answers in the tabs below. Next On January 1, 2021, Labtech Circuits borrowed $260,000 from First Bank by issuing a three-year, 9% note, payable on December 31, 2023. Labtech wanted to hedge the risk that general interest rates will decline, causing the fair value of its debt to increase. Therefore, Labtech entered into a three-year interest rate swap agreement on January 1, 2021, and designated the swap as a fair value hedge The agreement called for the company to receive paymegt based on an 9% fixed interest rate on a notional amount of $260,000 and to pay interest based on a floating interest rate tied to LIBOR. The contract called for cash settlement of the net interest amount on December 31 of each year: Floating (LIBOR) settlement rates were 9% at inception and 10%, 8%, and 8% at the end of 2021 2022 and 2023, respectively. The fair values of the swap are quotes obtained from a derivatives dealer. These quotes and the fair values of the note are as follows: December 31 Tair value of Interest rate swap Fair value of note payable January 1 2021 0 $260.000 2021 5. (3,359) 5256, 641 $2,535 $262.535 2023 $ 0 5260,000 Required: 1. Calculate the net cash settlement at the end of 2021 2022 and 2023 2. Prepare the journal entries during 2021 to record the issuance of the note, interest and necessary adjustments for changes in fair value 3. Prepare the journal entries during 2022 to record interest, net cash interest settlement for the interest rate swap, and necessary adjustments for changes in fair value 4. Prepare the journal entries during 2023 to record interest net cash interest settlement for the Interest rate swap, necessary adjustments for changes in fair value, and repayment of the debt 5. Calculate the book values of both the swap account and the note in each of the three years 6. Calculate the net effect on earnings of the hedging arrangement in each of the three years, dgnore Income taxes.) 7. Suppose the fale value of the note at December 31, 2021, had been 5247000 rather than $256,641 with the additional decline in fair value to investors' perceptions that the creditworthiness of Labtech was worsening How would that affect your entries to record Complete this question by entering your answers in the tabs below. Prev Na