On December 1, 2020, Venice Company (a U.S.-based company) entered into a three-month forward contract to purchase 1,010,000 pesos on March 1, 2021. The following U.S. dollar per peso exchange rates apply:

Date	Spot Rate			Forward Rate (to March 1, 2021)
December 1, 2020	$	0.009		$	0.012
December 31, 2020		0.011			0.014
March 1, 2021		0.015			N/A

Ignoring present values, Which of the following correctly describes the manner in which Venice Company will report the forward contract on its December 31, 2020, balance sheet?

Multiple Choice

• As a liability in the amount of $2,020

• As an asset in the amount of $1,010

• As a liability in the amount of $1,010

• As an asset in the amount of $2,020