Frank's Wine in a Can Company, a U.S. based importer of wines and spirits, placed an order with a French supplier for 1,000 cases of wine at a price of 200 euros per case. The total purchase price is 200,000 euros. Relevant exchange rates for the euro are as follows: Date Spot Rate Forward Rate to October 31 Call Option Premium for October 31 (strike price $1.00) $0.035 $0.070 $0.100 September 15 September 30 October 31 $1.00 $1.05 $1.10 $1.06 $1.09 $1.10 Frank's Wine Shop has an incremental borrowing rate of 12 percent (1 percent per month) and closes the books and prepares financial statements at September 30. a.) Assume that the wine arrived on 9/15, and the company made payment on 10/31. There was no attempt to hedge the exposure to foreign exchange risk. Prepare journal entries to account for this import purchase. b.) Assume that the wine arrived on 9/15, and the company made payment on 10/31 in euros. It properly designated the forward contract as a fair value hedge of a foreign currency payable. Prepare journal entries to account for the import purchase and foreign currency forward contract. c.) Frank's Wine Shop ordered the wine on 9/15. The wine arrived and the company paid for it on 10/31. On 9/15, Frank's entered into a 45-day forward contract to purchase 200,000 euros. The company properly designated the forward contract as a fair value hedge of a foreign currency firm commitment. The fair value of the firm commitment is measured by referring to changes in the forward rate. Prepare journal entries to account for the foreign currency forward contract, firm commitment, and import purchase. d.) The wine arrived on 9/15, and the company made payment on 10/31. On September 15, Frank's purchased a 45-day call option for 200,000 euros. It properly designated the option as a cash flow hedge of a foreign currency payable. Prepare journal entries to account for the import purchase and foreign currency option. e.) The company ordered the wine on 9/15. It arrived on 10/31, and the company made payment on that date. On 9/15, Frank's purchased a 45-day call option for 200,000 euros. It properly designated the option as fair value hedge of a foreign currency firm commitment. The fair value of the firm commitment is measured by referring to the changes in the spot rate. Prepare journal entries to account for the foreign currency option, firm commitment, and import purchase