How calm should account for the exchange rate fluctuation as

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Problem 1: On October 1, Calm Co., a U.S. company, contracted to purchase foreign goods requiring payment in francs one month after their receipt at Calm's factory. Title to the goods passed on December 15. The goods were still in transit on December 31. Exchange rates were one dollar to 22 francs, 20 francs, and 21 francs on October 1, December 15, and December 31, respectively. Calm should account for the exchange rate fluctuation as:

a. A loss included in net income before extraordinary items.

b. A gain included in net income before extraordinary items.

c. An extraordinary gain.

d. An extraordinary loss.

Reference no: EM133001764

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