On December 1, 2016, PEPPER Corporation entered into forward exchange contracts for speculative purposes in anticipation for a gain to sell U.S. $ 10,000 in 90 days for delivery on March 1, 2017 for P40.25. The fiscal year end for PEPPER Corporation is December 31. The Exchange rates available on various dates are as follows: 1-Dec-16 31-Dec-16 1-Mar-17 P40.35 SPOT RATE P40.00 P40.25 30-DAY Forward Rate 40.10 40.35 40.50 60-DAY Forward Rate 40.15 40.40 40.70 90-DAY Forward Rate 40.25 40.45 40.65 120-DAY Forward Rate 40.30 40.50 40.70

On December 1, 2016, PEPPER Corporation entered into forward exchange contracts for speculative purposes in anticipation for a gain to sell U.S. $ 10,000 in 90 days for delivery on March 1, 2017 for P40.25. The fiscal year end for PEPPER Corporation is December 31. The Exchange rates available on various dates are as follows: 1-Dec-16 31-Dec-16 1-Mar-17 P40.35 SPOT RATE P40.00 P40.25 30-DAY Forward Rate 40.10 40.35 40.50 60-DAY Forward Rate 40.15 40.40 40.70 90-DAY Forward Rate 40.25 40.45 40.65 120-DAY Forward Rate 40.30 40.50 40.70

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter13: Marketable Securities And Derivatives

Section: Chapter Questions

Problem 22E

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