On December 1, 2018, a U.S. company sold merchandise to a foreign company for 750,000 yuan. The payment in yuan is due on January 31, 2019. The spot rate was as follows: $0.20 per yuan on December 1, 2018; $0.19 per yuan on December 31, 2018; and $0.21 per yuan on January 31, 2019 when the payment was received. Which of the following incorrectly describes the accounting for this foreign currency transaction?
A. The foreign currency transaction gain included on the income statement for the year ending December 31, 2018 was $7,500.
B. The receivable was recorded at $150,000 on December 1, 2018.
C. The foreign currency transaction gain included on the income statement for the year ending December 31, 2019 was $15,000.
D. The receivable was recorded at $142,500 on the December 31, 2018 balance sheet.
Answer: A
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