Under a cash flow hedge, the change in the fair value of the hedging derivative is

O ignored.

O reported under AOCI in the balance sheet.

O reported under retained earnings in the balance sheet.

O reported in the income statement.

Allman, inc., enters into a call option contract with Betts Investment Co. on January 2, 2022. This contract gives Allman the option to purchase 1,000 shares of Upmann stock at $100 per share. The option expires on April 30, 2022. Upmann shares are trading at $100 per share on January 2, 2022, at which time Alman pays $500 for the call option. As of March 31, 2022, the price of the Upmann shares has risen to $128 per share, and the remaining time value of the option has dropped in value to $100. Alman is preparing fanciel statements for the quarter ending March 31. As regards this option how much income should Alman, inc report on its March 31 Income statement (ignore tax?

A. $0

B. $100

C. 27,600

D. $29,700

E. $30,000