On October $1,2024,$ Eagle Company forecasts the purchase of inventory from a British supplier on February $1,2025,$ at a price of $100,000$ British pounds. On October $1,2024,$ Eagle pays $$1,800$ for a three$-$month call option on $100,000$ pounds with a strike price of $$2\mathrm{.}00$ per pound. The option is considered to be a cash flow hedge of a forecasted foreign currency transaction. On December $31,2024,$ the option has a fair value of $$1,600.$ The following spot exchange rates apply:

Date Spot Rate

October $1,2024$ $ $2\mathrm{.}00$

December $31,2024$ $ $1\mathrm{.}97$

February $1,2025$ $ $2\mathrm{.}01$

What journal entry should Eagle prepare on October $1,2024?$

Event General Journal Debit Credit

A$)$ Cash $1,800$

Foreign Currency Option $1,800$

B$)$ Forward Contract $1,800$

Cash $1,800$

C$)$ Foreign Currency Option $1,800$

Foreign Exchange Gain or Loss $1,800$

D$)$ Foreign Exchange Gain or Loss $1,800$

Cash $1,800$

E$)$ Foreign Currency Option $1,800$

Cash $1,800$