On March 1, 2017, a U.S. company enters a forward contract locking in the selling price of C\($1\) ,000,000, for delivery on April 15, 2017. The contract does not qualify for hedge accounting. What is the gain or loss on the forward contract that is reported on the company’s 2017 income statement?

Use the following forward and spot prices for Canadian dollars (C\($)\) to answer this question. The prices are in U.S. dollars (\($/C$).

a.  \($5,000 \)loss

b. \($20,000\) gain

c. \($25,000\) loss

d.  \($5,000 \)gain

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Spot Forward rate for 4/15/17 delivery of rate Canadian dollars November 15, 2016 $0.905 $0.895 December 31, 2016 0.965 0.950 March 1, 2017 0.920 0.915 April 15, 2017 0.940 0.940