On January 15, when the spot rate is $0.15/HK$, a U.S. company purchases merchandise from a Hong Kong supplier for HK$1,000,000.On the same date, it enters a forward contract for delivery of HK$1,000,000 on March 15, at a price of $0.148/HK$.On March 15, when the spot rate is $0.156/HK$, the company closes the forward contract and pays for the merchandise.The merchandise has not yet been sold at March 15.

What amount, in U.S. dollars, does the company pay for the merchandise?At what amount, in U.S. dollars, does the merchandise appear on the company's March 15 balance sheet?

Amount PaidMerchandise Balance

a.$148,000$148,000

b.$156,000$150,000

c.$148,000$150,000

d.$150,000$156,000