1. On September 1, 2011, Bain Corporation received an order for equipment from a foreign c...

1. On September 1, 2011, Bain Corporation received an order for equipment from a foreign customer for 300,000 euros, when the U.S. dollar equivalent was $400,000. Bain shipped the equipment on October 15, 2011, and billed the customer for 300,000 euros when the U.S. dollar equivalent was $420,000. Bain received the customer’s remittance in full on November 16, 2011, and sold the 300,000 euros for $415,000. In its income statement for the year ended December 31, 2011, what should Bain report as a foreign exchange gain or loss?

2. On September 22, 2011, Yumi Corporation purchased merchandise on account from an unaffiliated foreign company for 10,000 euros. On that date, the spot rate was $1.20. Yumi paid the bill in full on March 20, 2012, when the spot rate was $1.30. The spot rate was $1.24 on December 31, 2011. What amount should Yumi report as a foreign currency transaction gain or loss in its income statement for the year ended December 31, 2011?

3. On July 1, 2011, Clark Company borrowed 1,680,000 pesos from a foreign lender by signing an interest-bearing note due on July 1, 2012, which is denominated in pesos. The U.S. dollar equivalent of the note principal was as follows:

In its income statement for 2012, what amount should Clark include as a foreign exchange gain or loss?

4. On July 1, 2011, Stone Company lent $120,000 to a foreign supplier by accepting an interest-bearing note due on July 1, 2012. The note is denominated in the currency of the borrower and was equivalent to 840,000 pesos on the loan date. The note principal was appropriately included at $140,000 in the receivables section of Stone’s December 31, 2011, balance sheet. The note principal was repaid to Stone on the July 1, 2012, due date, when the exchange rate was 8 pesos to $1. In its income statement for the year ended December 31, 2012, what amount should Stone include as a foreign currency transaction gain or loss?