FMC Co. uses gold in the manufacture of its jewelry products. FMC anticipates it will need to purchase 500 ounces of gold in October 2013 for jewelry it will ship during the holiday season. However, if the price of gold increases, FMC’s cost to produce its products will increase and reduce its profit margins.In order to hedge the risk of increased gold prices, on April 1, 2013, FMC enters into a gold futures contract and designates it as a cash flow hedge of the anticipated gold purchase (assume no premium paid.) The notional amount of the contract is 500 ounces, and the terms of the contract give FMC the option to purchase gold at $300 per ounce. The contract expires on October 31, 2013.Assume the following data with respect to the price of the gold:dateapril 1 2013 $300 per ouncejune 30 2013 $310 per ouncesept 30 2013 $315 per ounceREQUIRED:1.) Prepare the journal entries for the following transactions:Increase in the spot price of gold on June 30 & September 30.FMC’s purchase of 500 ounces of gold on October 10 at $315 and settlement of the futures contract on that date.FMC’s sale of product for $350,000 on December 20. The cost of the finished goods inventory was $200,000.2.) Indicate the amount(s) reported on the balance sheet related to the futures contract on June 30, 2013 and the income statement for December 31, 2013