12.On October 1, Boeing received an order from British Airways for a 747 for $200,000,000 to be paid on December 1. The exchange rates for $1 U.S. are as follows:

Exchange Rates (of $1 for British Pounds)

Spot rate, October 1 .70

Spot rate, December 1 .68

Forward rate, December 1 .71

Required:

If British Airways decided to hedge $150,000,000 andself insurethe balance, whatgainor loss would the company record on its books for the purchase of the 747?