Sheridan Company commonly issues long-term notes payable to its various lenders. Sheridan has had a pretty good credit rating such that its effective borrowing rate is quite low (less than 8% on an annual basis). Harper has elected to use the fair value option for the long-term notes issued to Barclays Bank and has the following data related to the carrying and fair value for these notes.

		Carrying Value			Fair Value
December 31, 2020		$109,000			$109,000
December 31, 2021		100,800			96,300
December 31, 2022		81,000			87,300

Prepare the adjusting entry at December 31 (Sheridan's year-end) for 2020, 2021, and 2022 to record the fair value option for these notes.

Date	Account Titles and Explanation	Debit	Credit
December 31, 2020

Date	Account Titles and Explanation	Debit	Credit
December 31, 2021

Date	Account Titles and Explanation	Debit	Credit
December 31, 2022

At what amount will the note be reported on Sheridan's 2021 balance sheet?

Amount

$

What is the effect of recording the fair value option on these notes on Sheridan's 2022 income? Income will decreaseincrease by $