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Recognizing gains on derivative financial instruments Our company uses the $US as its functional currency and purchased merchandise from a vendor in England on November 20 for 210,000 British pounds. Payment was due in British pounds on January 20. The spot rates to purchase one pound were as follows: November 20 $1.24 December 31 1.27 January 20 1.29 How should the foreign currency transaction gain or loss be reported on our company's financial statements at December 31? OA gain of $6,300 in the income statement OA loss of $6,300 in the income statement OA gain of $10,500 in the income statement OA loss of $10,500 in the income statement Recognizing foreign currency exchange losses On November 2, 2018, a U.S.-based company with the $US as its functional currency entered into a 90-day futures contract to purchase 80,000 Swiss francs when the contract quote was $1.09. The purchase was for speculation in price movement. The following exchange rates existed during the contract period: November 2, 2018 December 31, 2018 January 31, 2019 30 Day Futures Spot Rate $1.03 $1.04 $1.05 $1.07 $1.06 $1.08 What amount should the U.S.-based company report as foreign currency exchange loss in its income statement for the year ended December 31, 2018? O$4,800 O$4,000 O$3,200 O$1,600