Please answer all questions:

P 13-2 Fair-value hedge, option incremental borrowing rate is reasonable. 1. Why would you expect this situation to qualify for hedge accounting? 2. Why should this hedge be accounted for as a fair-value hedge instead of as a cash-flow hedge? 3. What entries should be made on May 1, 2016, to account for the firm commitment and the option? 4. Assume that the market price for Grade A silver is \\( \\$ 15 \\) per troy ounce on December 31,2016 . What are the required entries