Levin Company Entered into a Forward Contract to Speculate in the Foreign

question 53

Multiple Choice

Levin company entered into a forward contract to speculate in the foreign currency.It sold 100,000 foreign currency units under a contract dated November 1,20X8,for delivery on January 31,20X9:

In its income statement for the year ended December 31,20X8,what amount of loss should Levin report from this forward contract?

• A)$0
• B)$300
• C)$200
• D)$100

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Definitions:

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A dot or small symbol used to separate the integer part from the fractional part of a number in decimal notation.

Fractional-Inch

A unit of measurement in the customary system used in the United States, where measurements are expressed in fractions of an inch.

Reamers

Tools used to widen the size of a hole to precise dimensions and to improve its finish.

Engineering Drawings

Detailed drawings that communicate the specifications, dimensions, materials, and procedures for the manufacture or construction of an object.