chow co. purchased rice from china for 100,000 Rembini on Nov 1 2015. Payment is due on Jan 30 2016. Chow also entered into a 90 day forward contract to purchase 100000 Rembini. The Rates were as follows.

Nov 1- Spot Rate $.120 Forward Rate- $.126 Dec 31 2015- Spot Rate $.124 Forward rate- $.129 Jan 30 2016- Spot Rate $.127

1. Record all Journal Entries on the transaction, balance sheet and settlement date.

2. What would the gain/loss be without the forward exchange contract?

3. What is a forward exchange contract?