Exchange Gains and Losses on a Forward Exchange Contract That

question 2

Multiple Choice

Exchange gains and losses on a forward exchange contract that covers the same time period as the transaction which it provides a hedge for should be recognized as

• A) an extraordinary item.
• B) part of the original sales transaction.
• C) income from continuing operations.
• D) income from continuing operations, but only if material.

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Definitions:

Infirmity

The condition of being physically weak or frail, often due to illness or aging.

Optimism

A mindset characterized by a positive outlook and expectation that good things will happen.

Cognitive Functioning

Involves mental processes such as thinking, reasoning, remembering, problem-solving, and decision-making.

Pessimists

Individuals who generally expect negative outcomes or focus on the worst aspects of situations.