You Own One Futures Contract on Gold That You Purchased

question 91

Multiple Choice

You own one futures contract on gold that you purchased at a quoted price of 1,402.0. The current price quote is 1,500.2. The contract size is 100 ounces and the quotes are expressed in dollars and cents per ounce. What is your current profit or loss on this investment?

• A)$160.30
• B)$1,912.00
• C)$9,820.00
• D)$16,030.00
• E)$19,120.00

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Definitions:

Ending Inventory Value

The total value of all unsold inventory remaining at the end of an accounting period.

Average Cost Method

Uses the weighted average unit cost of the goods available for sale for both cost of goods sold and ending inventory.

Cost of Goods Sold

Direct expenditures involved in producing the merchandise a business sells.

FIFO Cost Flow

An inventory valuation method where the first items purchased are the first ones to be sold, assuming costs rise over time.