On April 1, 2011, Win of Canada ordered customized fittings from Ace, a U.S. firm, to be delivered on May 31, 2011, at a price of 50,000 Canadian dollars. The spot rate for Canadian dollars on April 1, 2011, was $0.71. Also on April 1, in order to fix the sale price of the fittings at $35,250, Ace entered into a 60-day forward contract with the exchange broker to hedge the Win contract. This derivative met the conditions set forth in ASC Topic 815 for a hedge of a foreign currency commitment. Exchange rates for Canadian dollars are as follows:

REQUIRED: Prepare all journal entries on Ace's books to account for the commitment and related events on April 1 and May 31,2011.

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April 1 $0.710 May 31 $0.725 Spot rate 60-day forward rate 0.705 0.715