Icebreaker Company (a U.S.-based company) purchases materials from a foreign supplier on December 1, 2020, with payment of 17,000 dinars to be made on March 1, 2021. The materials are consumed immediately and recognized as cost of goods sold at the date of purchase. On December 1, 2020, Icebreaker enters into a forward contract to purchase 17,000 dinars on March 1, 2021. Relevant exchange rates for the dinar on various dates are as follows: Date December 1, 2020 December 31, 2020 March 1, 2021 Spot Rate $ 3.50 3.60 3.75 Forward Rate (to March 1, 2021) $ 3.575 3.700 N/A a-1. Assuming that Icebreaker designates the forward contract as a cash flow hedge of a foreign currency payable, prepare journal entries for the import purchase and foreign currency forward contract in U.S. dollars. a-2. What is the impact on 2020 net income? a-3. What is the impact on 2021 net income? a-4. What is the impact on net income over the two accounting periods? b-1. Assuming that Icebreaker designates the forward contract as a fair value hedge of a foreign currency payable, prepare journal entries for the import purchase and foreign currency forward contract in U.S. dollars. b-2. What is the impact on net income in 2020 and in 2021? b-3. What is the impact on net income over the two accounting periods? Req A1 Req A2 to A4 Req B1 Req B2 to B3 Assuming that Icebreaker designates the forward contract as a cash flow hedge of a foreign currency payable, prepare jour entries for the import purchase and foreign currency forward contract in U.S. dollars. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.) Show more No Date General Journal Debit Credit 1 12/01/2020 3 59,500 Cost of goods sold Accounts payable (dinars) 59,500 12/01/2020 N No journal entry required > 3 12/31/2020 3 1,700 Foreign exchange gain or loss Accounts payable (dinars) 1,700 4 12/31/2020 Forward contract 2,125 13 Other comprehensive income 2,125 5 12/31/2020 1,700 1.700 6 12/31/2020 425 Other comprehensive income 425 7 03/01/2021 Foreign exchange gain or loss Accounts payable (dinars) 2,550 2,550 co 8 03/01/2021 850 Forward contract Other comprehensive income 850 9 03/01/2021 2.550 Other comprehensive income Foreign exchange gain or loss 2,550 10 03/01/2021 850 850 9 03/01/2021 Other comprehensive income Foreign exchange gain or loss 2,550 2.550 10 03/01/2021 850 850 11 03/01/2021 Foreign currency (dinars) Forward contract 60,775 % 63.750 Cash 12 03/01/2021 63.750 Accounts payable (dinars) Foreign currency (dinars) 63.750 Reg A2 to A4 > Req A1 Reg A2 to A4 Req B1 Req B2 to B3 a-2. What is the impact on 2020 net income? a-3. What is the impact on 2021 net income? a-4. What is the impact on net income over the two accounting periods? (Do not round intermediate calculations. Negative amounts should be entered with a minus sign.) a- 2. Impact on 2020 net income concom Impact on 2021 net income a- 3. a- 4. MU Impact on net income over 2020 and 2021 e Req A1 Req A2 to A4 Req B1 Req B2 to B3 b-2. What is the impact on net income in 2020 and in 2021? b-3. What is the impact on net income over the two accounting periods? (Do not round intermediate calculations. Negative amounts should be entered with a minus sign b- 2. Impact on 2020 net income Impact on 2021 net income b- 3 Impact on net income over 2020 and 2021