On November 1,2017,American Company Sold Inventory to a Foreign Customer

Multiple Choice

On November 1,2017,American Company sold inventory to a foreign customer.The account will be settled on March 1 with the receipt of $500,000 foreign currency units (FCU) .On November 1,American also entered into a forward contract to hedge the exposed asset.The forward rate is $0.70 per unit of foreign currency.American has a December 31 fiscal year-end.Spot rates on relevant dates were: The entry to record the forward contract is

A) FCU Receivable,350,000; Premium on Forward Contract,15,000; Dollars Payable,365,000
B) Dollars Receivable,365,000; Discount on Forward Contract,15,000; FCU Payable,350,000
C) FCU Receivable,365,000; Discount on Forward Contract,15,000; Dollars Payable,350,000
D) Dollars Receivable,350,000; Discount on Forward Contract,15,000; FCU Payable,365,000