Vermont Cheese Company has a $$5,000,000,7\%$ bank loan from National Bank. On January $1,2020,$ the bank loan has three years to maturity. Vermont enters into a three$-$year interest rate swap with Cheese Investments with a $$5$ million notional. The agreement calls for Vermont to receive a fixed interest rate of $7\%$ and pay a variable rate based on LIBOR at the beginning of the year. Payments are to be made to Cheese Investments for the net amount at each year$-$end. At the beginning of $2020,$ the LIBOR rate is $6\mathrm{.}75\%.$ The three$-$year fixed rate at the end of $2020$ is $9\%.$

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Required:

Prepare the journal entries that Vermont Cheese Company would make in $2020$ relating to the bank loan and the derivative. $($Round answers to the nearest dollar$)$