A company has a soybean inventory carried at cost, $800,000. The market value of the inventory is currently $810,000. The company hedges against a decline in the market value of the inventory by taking a short position in soybeans, locking in a 60-day futures price of $810,000. The position requires a margin deposit of $10,000, and the hedge qualifies as a fair value hedge of the soybean inventory. Fifty days later, the market value of the inventory is $812,000, the 10-day futures price is $811,800, the company closes its short position and sells its soybean inventory. All events occur within the company's accounting year and income effects are reported in cost of goods sold.
Required
Make the required journal entries to record the above events.

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The Answer of A company has a soybean inventory carried at cost, $800,000. The market value of the inventory is currently $810,000. The company hedges against a decline in the market value of the inventory by taking a short position in soybeans, locking in a 60-day futures price of $810,000. The position requires a margin deposit of $10,000, and the hedge qualifies as a fair value hedge of the soybean inventory. Fifty days later, the market value of the inventory is $812,000, the 10-day futures price is $811,800, the company closes its short position and sells its soybean inventory. All events occur within the company's accounting year and income effects are reported in cost of goods sold.
Required
Make the required journal entries to record the above events.

A Company Has a Soybean Inventory Carried at Cost, $800,000