What amount should be reported as foreign exchange gain

Reference no: EM131882893

Question: 1. JP sells goods to a Spanish customer at a price of 1 million euros. JP shipped good to its customer on December 10, Year1. The payment was received on March 1, Year2.

Date Spot rate Forward rate

12/10/Year1 $1.50 $1.53

12/31/Year1 $1.51 $1.46

3/1/Year2 $1.48 $1.45

1. What amount should be reported as foreign exchange gain (or loss) on the Year 1 Income Statement?

2. What amount should be reported as foreign exchange gain (or loss) on the Year 2 Income Statement?

Reference no: EM131882893

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