On April 1, 2012, Shannon Company, a U How Much Foreign Exchange Gain or Loss Should Be Included

Multiple Choice

On April 1, 2012, Shannon Company, a U.S. company, borrowed 100,000 euros from a foreign bank by signing an interest-bearing note due April 1, 2013. The dollar value of the loan was as follows: $\begin{array}{|l|l|}\hline {\text { Date }} & \text { Amount } \\\hline \text { April 1,2012 } & \$ 97,000 \\\hline \text { December 31,2012 } & \$ 103,000 \\\hline \text { April 1,2013 } & \$ 105,000 \\\hline\end{array}$ How much foreign exchange gain or loss should be included in Shannon's 2012 income statement?

A) $3,000 gain.
B) $3,000 loss.
C) $6,000 gain.
D) $6,000 loss.
E) $7,000 gain.