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need numeric response On June 1, Wellmax Co. (a U.S.-based company) sold goods to a foreign customer for 1,040,000 pesos. The customer will pay September
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On June 1, Wellmax Co. (a U.S.-based company) sold goods to a foreign customer for 1,040,000 pesos. The customer will pay September 1. On June 1. Wellmax bought an option (strike price =$0.066 ) to sell 1,040,000 pesos on September 1 . The time value of the option is excluded from the assessment of hedge effectiveness, and the change in time value is recognized in net income over the life of the option. The forelgn currency option is designated a fair value hedge. Relevant exchange rates and option premia follow. loss Step by Step Solution
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