Parker Corp

question 20

Multiple Choice

Parker Corp., a U.S. company, had the following foreign currency transactions during 2011: (1.) Purchased merchandise from a foreign supplier on July 5, 2011 for the U.S. dollar equivalent of $80,000 and paid the invoice on August 3, 2011 at the U.S. dollar equivalent of $82,000.
(2) ) On October 1, 2011 borrowed the U.S. dollar equivalent of $872,000 evidenced by a non-interest-bearing note payable in euros on October 1, 2011. The U.S. dollar equivalent of the note amount was $860,000 on December 31, 2011, and $881,000 on October 1, 2012.
What amount should be included as a foreign exchange gain or loss from the two transactions for 2012?

• A) $9,000 loss.
• B) $9,000 gain.
• C) $11,000 loss.
• D) $21,000 loss.
• E) $21,000 gain.

---

Definitions:

Vision

The ability to think about or plan the future with imagination or wisdom, often related to personal or organizational goals.

Website

A collection of related web pages, including multimedia content, typically identified with a common domain name, and published on at least one web server.

Nonverbal Communication

The process of conveying a message without the use of words, through gestures, facial expressions, and body language.

Cultures

The shared values, traditions, norms, customs, arts, history, folklore, and institutions of a group of people.