On December 31, 2020, Pepper Company paid 3,000 to purchase a 90-day call option for 500,000 Thailand
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Question:
12/1/20 12/31/20 3/1/21
Spot rate 1.20 1.28 1.27
Strike price 1.20 1.20 1.20
Fair value of call option 3,000 42,000 35,000
I. The December 31, 2020 accounts payable amounted to?
II. The December 31, 2020 foreign currency contract value-option is?
III. The December 31, 2020 net foreign exchange gain or loss is?
IV. The March 1, 2021 expiration date foreign exchange net gain or loss is?
V. The March 1, 2021 expiration date, the foreign currency contract value-option is?
VI. Calculate the options time value at December 1, 2020
VII. Calculate the option's intrinsic value at December 31, 2020.
VIII. Calculate the option's time value and intrinsic value at March 1, 2021.
Related Book For
Accounting Principles
ISBN: 978-1119411482
13th edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
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