On November 1, 20x1 Zamfir Company, a U -If Zamfir Does Not Attempt to Hedge This Transaction, What

question 4

Multiple Choice

On November 1, 20x1 Zamfir Company, a U.S. corporation, purchased minerals from a Russian company for 2,000,000 rubles, payable in 3 months. The relevant exchange rates between the U.S. and Russian currencies are given: $\begin{array}{lll} & \text { Spot rate } & \text { Forward rate(at February 1,20 x 2) } \\\text { November 1,20 x 1 } 1 & \$ 0.348 & \$ 0.348\\\text {December 31,20 x1 }& \$ 0.359 & \$ 0.352 \\\text { February 1. 20 x 2 } & \$ 0.344 &\end{array}$
-If Zamfir does not attempt to hedge this transaction, what is the gain or loss that should be shown on the company's December 31, 20x1 financial statements?

• A)$22,000 loss
• B)$21,450 loss
• C)$8,000 gain
• D)$7,800 gain

Understand the logical equivalence of conditional expressions.

Identify and describe the fallacy of denying the antecedent.

Determine when an argument can be considered sound based on the relationship between its premises and conclusion.

Learn and apply the correct form of expressing valid inference patterns in identity relationships.

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Definitions:

Average Tax Rate

The ratio of the total amount of taxes paid to the total taxable income, showing the percentage of income that goes to taxes.

Taxable Income

The portion of an individual's or a corporation's income that is subject to taxes by governmental authorities.

Average Tax Rate

A calculation of the proportion of total income that an individual or business pays in taxes, showcasing the fraction of gross income spent on taxes.

Taxable Income

Taxable income is the portion of an individual's or a company's income used to determine how much tax they owe to the government in a given tax year.