Metlock Jewelry Co.uses gold in the production of its products. Metlock anticipates that it will need to purchase 85 ounces of gold in November 2020, for jewelry that will be shipped prior to Valentines Day. However, if the price of gold increases this will increase the cost to produce the jewelry, which will result in lower profit margins. To hedge the risk of increased gold prices, on June 1, 2020, Metlock enters into a gold futures contract and designates this futures contract as a cash flow hedge of the anticipated gold purchase. The notional amount of the contract is 85 ounces, and the terms of the contract give Metlock the option to purchase gold at a price of $600 per ounce. The price will be good until the contract expires on November 30, 2020 Assume the following data with respect to the price of the call options and the gold inventory purchase Date Spot Price for November Delivery $600 per ounce June 1, 2020 645 per Ounce June 30, 2020 September 30, 2020 710 per ounce Present the Journal entries for the following dates/transactions (a) June 1, 2020-Inception of futures contract, no premium poid, June 30, 2020-Metlock prepares financial statements, (b) (c) (d) le) September 30, 2020-Metlock prepares financial statements November 1, 2020-Metlock purchases 85 ounces of gold at $710 per ounce and settles the futures contract. December 15, 2020 --- Metlock sells jewelry containing the gold purchased in November 2020 for $702,000. The cost of the finished goods inventory is $348,000. Indicate the amount(s) reported in the income statement related to the futures contract and the inventory transactions on December 31, 2020 () (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Date Debit No. Credit Account Titles and Explanation (a) b (b) co (d) (To record purchase.) (To record settlement of futures contract.) . (e) (To record sales.) (To record cost of goods sold.) | (To record cost of goods sold.) (To record change in earnings.) METLOCK JEWELRY CO. Partial Income Statement Sales revenue Cost of goods sold Gross profit $