Recognition of assets and liabilities for futures contracts On November 3, the spot price for cotton was $0.76/lb., and futures price for February delivery was $0.80/lb. On November 3, Levi Strauss bought 150 futures contracts on the commodity exchange at $0.80/lb. for acceptance in February. Each contract was for 25,000 lb. Levi Strauss designated these contracts as a fair value hedge of 3,750,000 lb. of current inventory which it expected to sell in February. The average spot of this inventory when purchased was $0.68/lb. Levi Strauss properly documented the hedge and employed fair value hedge accounting. On November 30, the company's fiscal year end, the February commodity exchange futures price was $0.85/lb. In the November 30 balance sheet, Levi Strauss should record the futures contracts as a Select one: a. $187,500 asset 0 b. $187,500 liability c. $3,187,500 asset d. $3,187,500 liability