Current Attempt in Progress

On January $1,2025,$ Oriole Technical Inc. issues a $5-$year, $5\%$ fixed$-$rate interest only, nonprepayable $$5,040,000$ note with interest

payable on June $30$ and December $31$ of each year. Oriole decides to change the interest rate from a fixed rate to variable rate and

enters into a swap agreement with Last Bank Financial. The swap agreement specifies that Oriole will receive a fixed rate at $5\%$ and

pay variable with settlement dates that match the interest payments on the debt. Assume that interest rates have increased during

$2025$ and that Oriole paid $$38,000$ as an adjustment to interest expense for the settlement at June $30,2025.$ The gain related to the

debt $($due to interest rate changes$)$ was $$123,000.$ The value of the obligation under the swap contract increased $$123,000.$

$($a$)$ Prepare the journal entry to record the payment of interest expense on June $30,2025.$

$($b$)$ Prepare the journal entry to record the receipt of the swap settlement on June $30,2025.$

$($c$)$ Prepare the journal entry to record the change in the fair value of the swap contract on June $30,2025.$

$($d$)$ Prepare the journal entry to record the change in the fair value of the debt on June $30,2025.$

$($Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select $"$No

Entry" for the account titles and enter $0$ for the amounts. List all debit entries before credit entries.$)$

No$.$ Account Titles and Explanation

$($a$)$

$($b$)$

$($c$)$

$($d$)$