On November 1, 2001 Zamfir Company, a U

Multiple Choice

On November 1, 2001 Zamfir Company, a U.S. corporation, purchased minerals from a Russian company for 2,000,000 rubles, payable in 3 months. The relevant exchange rates between the U.S. and Russian currencies are given: The company's incremental borrowing rate provides a discount rate of 0.975 for three months.
If Zamfir does not attempt to hedge this transaction, what is the gain or loss that should be shown on the company's December 31, 2001 financial statements?

A) $22,000 loss
B) $21,450 loss
C) $8,000 gain
D) $7,800 gain