Waterway Company commonly issues long-term notes payable to its various lenders. Waterway has had a pretty good credit rating such that its effective borrowing rate is quite low (less than 8% on an annual basis). Waterway has elected to use the fair value option for the long-term notes issued to Barclay's Bank and has the following data related to the carrying and fair value for these notes. Any changes in fair value are due to changes in market rates, not credit risk. a. Prepare the journal entry at December 31 (Waterway's year-end) for 2025,2026 , and 2027, to record the fair value option for these notes. (Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) b. At what amount will the note be reported on Waterway's 2026 balance sheet? Note to be reported on Waterway's 2026 balance sheet $ c. What is the effect of recording the fair value option on these notes on Waterway's 2027 net income? The effect of recording the fair value option would result in unrealized holding of $