On April 1 Coke, Inc. a U.S. company agreed to sell goods to a foreign buyer for 200,000 FC. The goods were to be shipped on May 1 with payment to be received June 30. The hedging contract, signed on April 1 and designated as a fair value hedge, called for the sale of 200,000 FC on June 30. Assume the May 31 is fiscal year end. Exchange rates are as follows:

Spot Rate: Fwd Rate:

4/1 $0.66 $0.69

5/1 $0.67 $0.68

5/31 $0.65 $0.66

Discount rate is 12%.

Prepare all necessary entries through May 31 for the hedge and sale.