TMK International just purchased equipment manufactured in Japan. The contract calls for the payment of 120 million Japanese yen, due in 90 days. Assume the present exchange rate is 109 yen per U.S. dollar, but rises to 112 yen per U.S. dollar in 90 days. What is the U.S. dollar gain or loss if no hedge is taken?

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The Answer of TMK International just purchased equipment manufactured in Japan. The contract calls for the payment of 120 million Japanese yen, due in 90 days. Assume the present exchange rate is 109 yen per U.S. dollar, but rises to 112 yen per U.S. dollar in 90 days. What is the U.S. dollar gain or loss if no hedge is taken?

TMK International Just Purchased Equipment Manufactured in Japan