On January 1^st,2014 ABC Inc

question 71

Multiple Choice

On January 1^st,2014 ABC Inc.had invoiced a client in New York for $10,000 US for services rendered that day.ABC did not hedge this receivable.The receivable is due in 60 days.On January 1^st,2014,the spot rate was $1US = $1.02CDN.On January 31^st,2014,the spot rate was $1US = $1.05CDN.What is the effect of the above information on ABC's January financial statements?

• A) A $300 foreign exchange gain.
• B) A $300 foreign exchange loss.
• C) A $300 credit to OCI.
• D) A $300 debit to OCI.

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Definitions:

Stock Market Index

A statistical measure that reflects the composite value of a selected group of stocks, representing a segment of the stock market.

Supply Of Corn

The total quantity of corn that producers are willing and able to sell at a given price level.

Price Of Corn

The cost at which corn is bought or sold, subject to fluctuations based on agricultural trends and economic conditions.

Soybeans

A species of legume native to East Asia, widely cultivated for its edible beans which serve as a significant source of protein and oil.