On November 1, 20X2, a calendar-year investor purchased a 90-day forward contract to buy 1,000 FCs at a forward rate of 1 FC = $1.01, when the spot rate was 1 FC = $1.00. On December 31, 20X2, the forward rate for a 30-day forward contract was 1 FC = $1.02. On February 1, 20X3, when the spot rate was 1 FC = $1.03, the investor paid the broker and received the foreign currency.
Required:
Prepare the entries necessary to record this information. Ignore the present value calculations.

Question

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The Answer of On November 1, 20X2, a calendar-year investor purchased a 90-day forward contract to buy 1,000 FCs at a forward rate of 1 FC = $1.01, when the spot rate was 1 FC = $1.00. On December 31, 20X2, the forward rate for a 30-day forward contract was 1 FC = $1.02. On February 1, 20X3, when the spot rate was 1 FC = $1.03, the investor paid the broker and received the foreign currency.
Required:
Prepare the entries necessary to record this information. Ignore the present value calculations.

On November 1, 20X2, a Calendar-Year Investor Purchased a 90-Day