2.99 See Answer

Question: On December 1, 2020, Venice Company (a


On December 1, 2020, Venice Company (a U.S.-based company) entered into a three-month for- ward contract to purchase 1,000,000 pesos on March 1, 2021. The following U.S. dollar per peso exchange rates apply:



On December 1, 2020, Venice Company (a U.-1

Ignoring present values, which of the following correctly describes the manner in which Venice Company will report the forward contract on its December 31, 2020, balance sheet?
a. As an asset in the amount of $1,000
b. As an asset in the amount of $4,000
c. As a liability in the amount of $1,000
d. As a liability in the amount of $4,000

2.99

See Answer