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What is the gain on purchase commitment to be recognized

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Reference no: EM132807040

Problem 1: On November 15, 2020, Diamond Company entered into a commitment to purchase 10,000 ounces of gold on February 15, 2021 at a price of P310 per ounce. On December 31, 2020, the market price of gold is P270 per ounce. On February 15, 2021, the price of gold is P300 per ounce. What is the gain on purchase commitment to be recognized on February 15, 2021?

Option 1: 400,000

Option 2: 300,000

Option 3: 100,000

Option 4: 0

Reference no: EM132807040

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