A U.S.manufacturer has sold goods to a foreign firm for a sale price of 80,000 FC on 12/15/16.The invoice is due 1/15/17.The U.S.Firm fiscal year is 12/31/16.Given the following exchange rates, what gain or loss would the U.S.firm record on 12/31? ?
$$\begin{array} { l l }
12 / 15 & 1 \mathrm { FC } = \$ 0.60 \text { US Dollars } \
12 / 31 & 1 \mathrm { FC } = \$ 0.65 \text { US Dollars } \
1 / 15 & 1 \mathrm { FC } = \$ 0.63 \text { US Dollars }
\end{array}$$

Question

A U.S.manufacturer has sold goods to a foreign firm for a sale price of 80,000 FC on 12/15/16.The invoice is due 1/15/17.The U.S.Firm fiscal year is 12/31/16.Given the following exchange rates, what gain or loss would the U.S.firm record on 12/31? ?
$$\begin{array} { l l } 
12 / 15 & 1 \mathrm { FC } = \$ 0.60 \text { US Dollars } \
12 / 31 & 1 \mathrm { FC } = \$ 0.65 \text { US Dollars } \
1 / 15 & 1 \mathrm { FC } = \$ 0.63 \text { US Dollars }
\end{array}$$

Quizplus · Accepted Answer

The U.S. firm would record a gain of $4,000 on 12/31 because the value of the foreign currency increased from $0.60 to $0.65 per FC from 12/15 to 12/31. The calculation is (0.65 - 0.60) * 80,000 FC = $4,000.

A USmanufacturer Has Sold Goods to a Foreign Firm for a a Sale