MT Corporation imports cheeses for distribution in the United States (US). On August 1, the company purchased cheese costing 100,000 Euro. Payment is due in Euro on November 1. The spot rate on August 1 was $1.20 per Euro, and on November 1, it was $1.25 per Euro.

Determine the following:

1. The company's liabilities in US Dollars prior to payment

2. The amount of payment in US Dollars on November 1 Briefly discuss implications of the transaction.