On July 1, 2017, Mifflin Company borrowed 200,000 euros from a foreign lender evidenced by an interest-bearing note due on July 1, 2018. The note is denominated in euros. The U.S. dollar equivalent of the note principal is as follows: Date Amount July 1, 2017 (date borrowed) $ 225,000 December 31, 2017 (Mifflin's year-end) 220,000 July 1, 2018 (date repaid) 210,000 In its 2018 income statement, what amount should Mifflin include as a foreign exchange gain or loss on the note? $10,000 gain $10,000 loss $15,000 loss $15,000 gain
On July 1, 2017, Mifflin Company borrowed 200,000 euros from a foreign lender evidenced by an interest-bearing note due on July 1, 2018. The note is denominated in euros. The U.S. dollar equivalent of the note principal is as follows: Date Amount July 1, 2017 (date borrowed) $ 225,000 December 31, 2017 (Mifflin's year-end) 220,000 July 1, 2018 (date repaid) 210,000 In its 2018 income statement, what amount should Mifflin include as a foreign exchange gain or loss on the note? $10,000 gain $10,000 loss $15,000 loss $15,000 gain
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On July 1, 2017, Mifflin Company borrowed 200,000 euros from a foreign lender evidenced by an interest-bearing note due on July 1, 2018. The note is denominated in euros. The U.S. dollar equivalent of the note principal is as follows:
| Date | Amount |
| July 1, 2017 (date borrowed) | $ 225,000 |
| December 31, 2017 (Mifflin's year-end) | 220,000 |
| July 1, 2018 (date repaid) | 210,000 |
In its 2018 income statement, what amount should Mifflin include as a foreign exchange gain or loss on the note?
$10,000 gain
$10,000 loss
$15,000 loss
$15,000 gain
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