On January $2,2022,$ ABC Co$.$ issued a $4$ year, $$100,000$ note at $6\%$ fixed interest,

interest payable semiannually. ABC Co$.$ now wants to change the note to a

variable$-$rate note.

AS a result, on January $2,2022,$ ABC Co$.$ enters into an interest rate swap where it

agrees to receive $6\%$ fixed and pay LIBOR of $5\mathrm{.}7\%$ for the first $6$ months on

$$100,000.$ At each $6-$months period, the variable rate will be reset. The variable

rate is reset to $6\mathrm{.}7\%$ on June $30,2022.$

Instruc$9$ons:

a$)$ Compute the net interest expense to be reported for this note and related

swap transac$4$on as of June $30,2022$

b$)$ Compute the net interest expense to be reported for this note and related

swap transac$4$on as of December $31,2022.$