A Company Enters into a Forward Exchange Contract to Hedge

True/False

A company enters into a forward exchange contract to hedge its US dollar payable which is due in 90 days.The company committed to purchase sufficient US currency to settle its liability at a rate of $1 US=$1.20 CAD US.The company's year-end falls 30 days before the settlement date.On that date, the forward rate for 30-day settlement contracts was 1 US=$1.22 CAD US.As a result of these facts the company will record a gain on its current year financial statements.