A company has $1,000,000 in variable rate debt, with interest due on December 31 of each year. Interest is set at the Treasury bill rate plus 1.2%. The principal of the loan is due December 31, 2021. On January 1, 2020, the company enters a two-year receive variable/pay fixed interest rate swap, at a fixed rate of 2.2%. The swap is settled at the end of each year. The Treasury bill rate for 2020 is 0.8%, and it is 0.7% in 2021. The company records the swap at the expected future receipts/payments, equal to the receipt/payment for the current year, discounted at the variable rate. The swap qualifies as a cash flow hedge of the variable interest payments, and income effects of the debt and the swap are reported in interest expense.

At the end of 2020, the company adjusts the swap to its current value. The effect on other comprehensive income is a

Select one:

A. credit of $883. B. debit of $3,000. C. credit of $56. D. debit of $1,061.