Reference no: EM132619424

Question - Amber Inc., a U.S. company, had the following foreign currency transactions during 20X1: (i)Purchased merchandise from a foreign supplier on July 5, 20X1 for the U.S. dollar equivalent of $180,000 and paid the invoice on August 3, 20X1 at the U.S. dollar equivalent of $185,000; (ii) On October 1, 20X1 borrowed the U.S. dollar equivalent of $932,000 evidenced by a non-interest-bearing note payable in euros on October 1, 20X1. The U.S. dollar equivalent of the note amount was $860,000 on December 31, 20X1, and $881,000 on October 1, 20X2. What amount should be included as a foreign exchange gain or loss from the two transactions for calendar year 20X1?

a. None of the these

b. $77,000 Gain

c. $77,000 Loss

d. $67,000 Gain

e. $67,000 Loss