On October 31, 2012, Darling Company negotiated a two-year 100,000 franc loan from a foreign bank at an interest rate of 3 percent per year. Interest payments are made annually on October 31, and the principal will be repaid on October 31, 2014. Darling prepares U.S.-dollar financial statements and has a December 31 year-end. Prepare all journal entries related to this foreign currency borrowing assuming the following: 
Definitions:
Interest Rate
The proportion of a total amount of money that is levied for borrowing it, usually stated on a yearly basis.
Investment
The allocation of resources, usually money, in assets with the expectation of earning a future return.
Face Value
The nominal value printed on a financial instrument like a bond or currency note, representing its legal value.
Compound Interest
Interest on a loan or deposit calculated based on both the initial principal and the accumulated interest from previous periods.
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