On September 30, 2020, Peace Frog International (PFI) (a U.S.-based company) negotiated a two-year, 2,300,000 Chinese yuan loan from a Chinese bank at an interest rate of 4 percent per year. The company makes interest payments annually on September 30 and will repay the principal on September 30, 2022. PFI prepares U.S. dollar financial statements and has a December 31 year-end. Relevant exchange rates are as follows: U.S. Dollar per Chinese Yuan Date September 30, 2020 (CNY) $0.120 December 31, 2020 0.125 September 30, 2021 0.140 December 31, 2021 September 30, 2022 0.145 0.170 a. Prepare all journal entries related to this foreign currency borrowing. b. Taking the exchange rate effect on the cost of borrowing into consideration, determine the effective interest rate in U.S. dollars on the loan in each of the three years 2020, 2021, and 2022. Journal entry worksheet 1 2 3 4 5 6 7 8 > Record the receipt of 2,300,000 million yuan note. Note: Enter debits before credits. Date 09/30/2020 General Journal Debit Credit Record entry Clear entry View general journal < Required A Required B > Journal entry worksheet < 1 2 3 4 5 6 7 8 > - Record the accrued interest for the period 09/30/2020 12/31/2020. Note: Enter debits before credits. Date 12/31/2020 General Journal Debit Credit Record entry Clear entry View general journal < Required A Required B > Journal entry worksheet > 12 3 4 5 6 7 8 Record to revalue the note payable at the spot rate, and record the foreign exchange gain/loss thereof. Note: Enter debits before credits. Date General Journal Debit Credit 12/31/2020 Record entry Clear entry View general journal < Required A Required B > > Journal entry worksheet > 1 2 3 4 5678 Record the first annual interest payment, record interest expense for the - period 01/01/2021 09/30/2021, and record a foreign exchange gain or loss on the interest payable accrued at 12/31/2020. Note: Enter debits before credits. Date 09/30/2021 General Journal Debit Credit Record entry Clear entry View general journal < Required A Required B > > Journal entry worksheet > 1 2 3 4 5 6 7 8 > - Record the accrued interest for the period 09/30/2021 12/31/2021. Note: Enter debits before credits. Date 12/31/2021 General Journal Debit Credit Record entry Clear entry View general journal < Required A Required B > Journal entry worksheet > 1 2 3 4 5 60 7 8 Record to revalue the note payable at the spot rate, and record the foreign exchange gain/loss thereof. Note: Enter debits before credits. Date 12/31/2021 General Journal Debit Credit Record entry Clear entry View general journal < Required A Required B > > Journal entry worksheet > 123456 - 7 8 Record the second annual interest payment, record interest expense for the period 01/01/2022 09/30/2022, and record a foreign exchange gain or loss on the interest payable accrued at 12/31/2021. Note: Enter debits before credits. Date 09/30/2022 General Journal Debit Credit Record entry Clear entry View general journal < Required A Required B > > Journal entry worksheet > 1 2 3 4 5 6 7 Record the payment of 1 million yuan note. Note: Enter debits before credits. Date 09/30/2022 General Journal Debit Credit Record entry Clear entry View general journal < Required A Required B >