A US Company Forecasts That It Will Sell €100,000 in Merchandise

A U.S. company forecasts that it will sell €100,000 in merchandise to an Italian customer in mid-February 2021, and will collect payment, in euros, on delivery. On November 1, 2020, it enters a forward contract, locking in the selling price of €100,000 at $1.232/€ for delivery on February 15, 2021. The forward qualifies as a cash flow hedge of a forecasted transaction. On January 10, 2021, the company closes the forward contract. On February 15, 2021, the company sells €100,000 of merchandise to the Italian customer, receives immediate payment in euros, and exchanges euros for U.S. dollars on the spot market. Information on $/€ exchange rates follows:
$$\begin{array} { | l | c | c | } \hline & \text { Spot Rate } & \begin{array} { c } \text { Forward Rate for } \\\text { February 15, 2021 Delivery }\end{array} \\\hline \text { November 1, 2020 } & \$ 1.230 & \$ 1.232 \\\hline \text { December 31, 2020 } & 1.233 & 1.234 \\\hline \text { January 10, 2021 } & 1.247 & 1.248 \\\hline \text { February 15, 2021 } & 1.256 & 1.256 \\\hline\end{array}$$ Required
Prepare the journal entries to record these events, including any adjusting entries at the company's December 31 year-end.