UBSS Ltd manufactures electric boards. On 4 June 2018, UBSS Ltd entered into a non-cancellable purchase commitment with GCA Ltd to supply wheels, with the wheels to be shipped on 30 June 2018. The total contract price was US$3000000, and the full amount was due for payment on 30 August 2018. Because of concerns about movements in foreign exchange rates, on 4 June 2018 UBSS Ltd entered into a forward rate contract on US dollars with a foreign exchange broker so as to receive US$3000000 on 30 August 2018 at a forward rate of $A1.00 = US$0.78. UBSS Ltd prepares monthly financial statements, and it elects to treat the hedge as a cash flow hedge. Additional information The respective spot rates, the forward rates offered on particular dates, for delivery of US dollars on 30 August 2018, are provided below. Date 4 June 2018 30 June 2018 31 July 2018 30 August 2018 Spot rate $A1.00 US$0.80 $A1.00 = US$0.78 $A1.00 US$0.75 $A1.00 = US$0.72 = Required: (A) Calculate foreign exchange gain or loss. [5 marks] (B) Calculate gain or loss on a forward contract. [6 marks] Forward rates for 30 August 2018 delivery of US$ $A1.00 US$0.78 $A1.00 = US$0.76 $A1.00 = US$0.74 $A1.00 = US$0.72 (C) Provide the journal entries to account for the hedged item' and the 'hedging instrument for 30 June, 31 July, and 30 August 2018. [9 marks]