E 12-9 Various foreign currency–denominated transactions settled in subsequent year Meo imports merchandise from some Canadian companies and exports its own products to other Canadian companies.

The unadjusted accounts denominated in Canadian dollars at December 31, 2016, are as follows:

Account receivable from the sale of merchandise on December 16 to Cav. Billing is for 150,000 Canadian dollars and due January 15, 2017

$103,500 Account payable to Fot for merchandise received December 2 and payable on January 30, 2017. Billing is for 275,000 Canadian dollars.

$195,250 Derivatives and Foreign Currency: Concepts and Common Transactions 437 Exchange rates on selected dates are as follows:

December 31, 2016 $0.680 January 15, 2017 $0.675 January 30, 2017 $0.685 REQuIRED 1. Determine the net exchange gain or loss from the two transactions that will be included in Meo’s income statement for 2016.

2. Determine the net exchange gain or loss from settlement of the two transactions that will be included in Meo’s 2017 income statement.