Accounting for a Futures Hedge

Hi,

I am currently trying to figure out how to account in the Balance Sheet, Cash Flow Statement, and Income Statement for the following transaction.

I buy 10 futures on inventory purchases today, to receive the inventory one year from now in the next accounting period.

Contracted Futures price $1 Inventory Price (in year 2) $1.2

Today (year 1) I pay the broker deposit (%10): $1 --> Assets: Cash down $1, Broker deposit up $1.

In the next accounting period I close the broker account. Cash +$1 (closed Deposit), Assets -$1

Inventory up by $10 (futures price times quantity 10x$1)

How do I account for the Gain in my Derivative ($1.2-$1)x10 = $2

Is this Gain reflected in the Income Statement or Other Comprehensive Income? etc.

Where else do these items flow through?

How do I account for COGS and the Gain in Derivative once the inventory has been sold?