Required information On January 1,2024, Avalanche Corporation borrowed $102,000 from First Bank by issuing a two-year, 8% fixed-rate note with annual interest poyments. The principal of the note is due on December 31,2025. - Avalanche wanted to hedge against declines in general interest rates, so it also entered into a two-year SOFR-based. interest rate swap agreement on January 1, 2024, and designates it, as a fair value hedge. Because the swap is entered at market rates, the fair value of the swap is zero at inception. - The agreement called for the company to recelve fixed interest at the current SOFR swap rate of 5% and pay floating interest tied to SOFR. This arrangement results in an effective variable rate on the note of SOFR+3%. - The contract specifies that the floating rate resets each year on June 30 and December 31 for the net settlement that is due the following period. In other words, the net cash settiement is calculated using beginning-of-period rates: The SOFR rates on the swap reset dates and the fair values of the swap obtained from a ritoriuman...... lows: 2. Calculate the net cash settiement at each settlement date during 2024 and 2025 3. Prepare the joumat entries during 2024 to record the issuance of the note, interest, net cash settlement for the interest rate swap, and necessary adjustments for changes in fair value under the shortcut method. 4. Prepare the joumat entries during 2025 to record interest, net cash settement for the interest rate swap, necessary adjustments for changes in fair value, and repoyment of the debt. Complete this question by entering your answers in the tabs below. Caliculate the net ash inttiement at each sertiement date during 2024 and 2025 . Note: Indicale parment smounts with in minyt Algh, Complete this question by entering your answers in the tabs below. Record the issuance of the note, interest, net cash settiement for the interest rate swap, and necessary adjustments for changes in fair value under the shortcut method. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Record the interest, net cash settiement for the interest rate swap, necessary adjustments for changes in fair value, and repayment of the debt. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. 1 Kecora the incerest on the note. 2 Record the net cash settlement on the swap. 3 Record the change in fair value of the derivative. 4. Record the change in fair value of the note due to interest. 5 Record the interest on the note. 6 -Record the net cash settiement on the swap. ? Record the change in fair value of the derivative. A Record the chanoe in fair value of the note due to Note : O= joumal entry has been entered