RXN's year-end is on December 31. On November 1, 2019 when the U.S. dollar was worth CDN$1.365, RXN sold merchandise to an American client for US$300,000. Full payment of this invoice was expected by March 1, 2020. On December 1, the spot rate was CDN$1.3450 and the three-month forward rate was CDN$1.3250. In order to minimize its Foreign Exchange risk and exposure, RXN entered into a forward contract with its bank on December 1, 2019 to deliver US$300,000 in three months' time. The spot rate at year-end was CDN$1.36 and the forward rate from December 31, 2019 to March 1, 2020 was CDN$1.34. On March 1, 2020, RXN received the US$300,000 from its client and settled its contract with the bank. The forward contract was to be accounted for as a fair value hedge of the US dollar receivable. Significant dates and exchange rates pertaining to this transaction are as follows:

	Spot Rates	Forward Rates*
November 1, 2019 (Transaction date)	US$1 = CDN$1.365
December 1, 2019 (Hedged date)	US$1 = CDN$1.3450	US$1 = CDN$1.3250
December 31, 2019 (Year-end)	CDN$1.36	CDN$1.34
March 1, 2020 (Settlement date)	US$1 = CDN$1.368.	US$1 = CDN$1.368.

*for contracts expiring on March 1, 2020 At what amount (in Canadian Dollars) would the forward contract with the bank be recorded, if recorded gross?

Select one:

A. $397,500

B. $403,500

C. $402,000

D. $409,500