Recording a Hedged International Loan The Roderick Company borrowed 50 million from a London bank on December

Question:

Recording a Hedged International Loan The Roderick Company borrowed £50 million from a London bank on December 16,2014. The £50 million were immediately converted to dollars for use in the United States and were scheduled to be repaid with interest of £500,000 on January 15, 2015. To hedge the risk of an unfavorable change in the exchange rate, Roderick purchased £50.5 million for delivery on January 15, 2015. Roderick's accounting period ends on December 31. Exchange rates on various dates follows:.