Big Bike Plating Company Uses Chrome to Plate Motorcycle Parts

Big Bike Plating Company uses chrome to plate motorcycle parts.Big Bike forecasts a need for 100,000 kilos of chrome on January 1,2015.On November 1,2014,Big Bike purchased a call option for 100,000 kilos of chrome on January 1,2015,at a price of $1.05 a kilo,which is the market price on November 1.Big Bike paid $900 for the call option and designated this option as a hedge against price fluctuations for their January purchase of chrome.On December 31,2014 and January 1,2015,the prevailing market price for chrome is $1.25 a kilo.On January 1,2015 Big Bike purchased 100,000 kilos of chrome.
Required: Make the necessary entries on Big Bike's books at:
(a)November 1,2014
(b)December 31,2014
(c)January 1,2015