Myway Company Sold Equipment to a Canadian Company for 100,000

Multiple Choice

Myway Company sold equipment to a Canadian company for 100,000 Canadian dollars (C$) on January 1,20X9 with settlement to be in 60 days.On the same date,Myway entered into a 60-day forward contract to sell 100,000 Canadian dollars at a forward rate of 1 C$ = $.94 in order to manage its exposed foreign currency receivable.The forward contract is not designated as a hedge.The spot rates were:

-Based on the preceding information,had Myway not used the forward exchange contract,net income for the year would have:

A) increased by $1,000.
B) increased by $500.
C) decreased by $1,000.
D) decreased by $1,500.