Solution-What is the net forex gain or loss from this

What is the net forex gain or loss from this transaction

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Question - James Corp. entered into a forward contract to hedge a sale of inventory in October 26, 2030 to be collected on January 24, 2031. 72,000 FC in 90 days. The relevant exchange rates are as follows:

	Spot Rate	Forward Rate (1/24/2031)
October 26, 2030	P52.73	P52.77
December 31, 2030	52.82	52.89
January 24, 2031	52.94

Required -

1. What is the net forex gain (loss) from this transaction and hedge that will be reported on James' 2030 statement of income?

2. The fair value of the forward contract on October 26, 2030 is ____.

3. Determine the cost to James of entering into hedge of the foreign currency on October 26, 2030.

4. Total sales to be recorded in the 2030 income statement is ____.

5. The fair value of the forward contract liability on December 31, 2030 is _____.

Reference no: EM133078644

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What is the net forex gain or loss from this transaction

Reference no: EM133078644

Reference no: EM133078644

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