On December 1, 2015, Worthy Corporation forecasts that it will need 100,000 pounds of metal in 90 days to manufacture its products. To lock in the current price of metal, it purchases the 100,000 pounds of metal for delivery in 90 days [this is called taking long position] at $16 per 100 pounds using a futures contract. The long futures position qualifies as a cash flow hedge of the forecasted purchase of metal and is considered highly effective. To acquire the futures contract, Worthy Co has to pay $500 on December 1. Spot rates for the metal per 100 pounds are as follows

December 31, 2015	$16.45
March 1, 2016	$16.65

On April 1, 2016, Worthy Corporation sold its product for $60,000.

Required:

Assume that the futures contract is designated as a CASH FLOW hedge to manage the companys forecasted purchase. Prepare journal entries for Worthy Corporation to record the this forecasted transaction to purchase metal and all entries associated with the futures contract, including the adjusting entries required on December 31, 2015; March 1, 2016, and April 1, 2016