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Grabill, Indiana | We finally made the jump into using hedges to help protect our price. Now I have a question on accounting for appreciation in that hedge along with a forward contract.
Here is the situation, we forward contracted 750 bushels of NC soybeans at $10.95, at the same time we executed a bull spread using the May contracts and 1320 and 1380 strike prices. So far that spread has been a good move.
If we liquidate that position right now we would earn about $850 on that spread, how do you account for that appreciation along with that forward contract?
Jim | |
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Accounting for Hedge Gain on Forward Contract
