Icebreaker Company (a U.S.-based company) sells parts to a foreign customer on December 1, 2020, with payment of 27,000 dinars to be received on March 1, 2021. Icebreaker enters into a forward contract on December 1, 2020, to sell 27,000 dinars on March 1, 2021. Relevant exchange rates for the dinar on various dates are as follows:

Date	Spot Rate			Forward Rate (to March 1, 2021)
December 1, 2020	$	4.50		$	4.575
December 31, 2020		4.60			4.700
March 1, 2021		4.75			N/A

Icebreaker must close its books and prepare financial statements at December 31.

1. b-1. Assuming that Icebreaker designates the forward contract as a fair value hedge of a foreign currency receivable, prepare journal entries for the sale and foreign currency forward contract in U.S. dollars.

2. b-2. What is the impact on net income over the two accounting periods resulting from flucutations in the value of the foreign currency? [Looking for net effect on the Foreign Exchange Gain/Loss account]