On September $30,2020,$ Peace Frog International $($PFI$)($a U$.$S$.-$based company$)$ negotiated a two$-$year, $2,000,000$ 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:

Date U$.$S$.$ Dollar per Chinese Yuan $($CNY$)$

September $30,2020$ $ $0\mathrm{.}200$

December $31,20200\mathrm{.}205$

September $30,20210\mathrm{.}220$

December $31,20210\mathrm{.}225$

September $30,20220\mathrm{.}250$

A$.$ Prepare all journal entries related to this foreign currency borrowing.

$2.$ Record the accrued interest for the period $09/30/202012/31/2020.$

$3.$ Record to revalue the note payable at the spot rate, and record the foreign exchange gain$/$loss thereof.

$4.$ Record the first annual interest payment, record interest expense for the period $01/01/202109/30/2021,$ and record a foreign exchange gain or loss on the interest payable accrued at $12/31/2020.$

$5.$ Record the accrued interest for the period $09/30/202112/31/2021.$

$6.$ Record to revalue the note payable at the spot rate, and record the foreign exchange gain$/$loss thereof.

$7.$ Record the second annual interest payment, record interest expense for the period $01/01/202209/30/2022,$ and record a foreign exchange gain or loss on the interest payable accrued at $12/31/2021.$

$8.$ Record the payment of $1$ million yuan note.

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 $2022.$