Spartan Company purchased interior decoration material from Egypt for 100,000 Egyptian pounds on September 5, 20X8, with payment due on December 2, 20X8. Additionally, on September 5, Spartan acquired a 90-day forward contract to purchase 100,000 Egyptian pounds of E£ = $.1850. The forward contract was acquired to manage the exposed net liability position in Egyptian pounds, but it was not designated as a hedge. The spot rates were: September 5, 20X8E£1 =$0.1835 December 2, 20X8E£1 =$0.1865 Based on the preceding information, what is the entry required to settle foreign currency payable on December 2? A.Accounts Payable (E£)18,800 Foreign Currency Units (E£) 18,800B.Accounts Payable (E£)18,500 Foreign Currency Units (E£) 18,500C.Accounts Payable (E£)18,650 Foreign
Currency Units (E£) 18,650D.Accounts Payable (E£)18,350 Foreign Currency Units (E£) 18,350
A. Option A
B. Option B
C. Option C
D. Option D
Answer: C
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