The Following Information Pertains to Questions

question 4

Multiple Choice

The following information pertains to questions
XYZ Corp has a calendar year end.On January 1,2010,the company borrowed $5,000,000 U.S.dollars from an American Bank.The loan is to be repaid on December 31,2013 and requires interest at 5% to be paid every December 31.The loan and applicable interest are both to be repaid in U.S.dollars.XYZ does not hedge to minimize its foreign exchange risk.
The following exchange rates were in effect throughout the term of the loan: The average rates in effect for 2010 and 2011 were as follows:
-What is the amount of the foreign exchange gain or loss recognized on the 2010 Income Statement?

• A)A $5,000 gain.
• B)A $5,000 loss.
• C)A $10,000 gain.
• D)A $10,000 loss.

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Definitions:

Union Formation

The process of organizing and establishing a union, typically involving workers coming together to advocate for their collective rights and interests.

Collective Action

The effort made by a group to reach and implement agreements in the pursuit of a common interest or goal.

Routine Collective Action

The repetitive and predictable actions performed by groups or collectives as part of their normal functioning.

Revolutionary Action

A significant and often sudden action or movement aimed at causing fundamental changes in societal structures.