Monument Company (a U.S.-based company) ordered a machine costing 100,000 from a foreign supplier on January 15, when the spot rate was $1.20 per . A one-month forward contract was signed on that date to purchase 100,000 at a forward rate of $1.23. The forward contract is properly designated as a fair value hedge of the 100,000 firm commitment. On February 15, when the company receives the machine, the spot rate is $1.22. At what amount should Monument Company capitalize the machine on its books?

• $122,000

• $123,000

• $121,000

• $120,000