St. Philip Company ordered parts costing 100,000 from a foreign supplier on January 15 when the spot rate was $0.20 per . A one-month forward contract was signed on that date to purchase 100,000 at a forward rate of $0.23. The forward contract is properly designated as a fair value hedge of the 100,000 firm commitment. On February 15, when the company receives the parts, the spot rate is $0.22. At what amount should St. Philip Company carry the parts inventory on its books?

a. $20,000.

b. $21,000.

c. $22,000.

d. $23,000.