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What is the value of the forward contract receivable-fc

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On 6/1/20x4, a Philippine firm purchased an inventory costing 100,000 foreign currency units (FCU) from a foreign firm to be paid on 8/1/20x4. Also on 6/1/20x4, the Philippine firm entered into a forward contract to purchase 100,000 FCUs for delivery on 8/1/20x4. The exchange rates were as follows:

Date                       Spot rate            Forward rate
6/1/20x4           1 FCU = P0.73      1 FCU = P0.74
6/30/20x4          1 FCU = P0.70       1 FCU = P0.75
8/1/20x4           1 FCU = P0.68          1 FCU = P0.68

The Philippine firm's fiscal year end is 6/30/20x4. The changes in the value of the forward contract should be discounted at 8%

Problem 1: What is the value of the Forward Contract Receivable-FC on 6/1/20x4?

Problem 2: What is the value of the Forward Contract Receivable-FC on 6/30/20x4?

Reference no: EM132807268

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