Passion Ltd$.$ is a Canadian retailer specializing in importing high$-$quality fashions from Milan, Italy. On November $15,2024,$ Passion ordered merchandise from a Milan fashion house for $2,000,000($Euros$).$ The merchandise was received on January $15,2025,$ payable within $60$ days of receipt. Passion paid for this merchandise on March $14,2025.$

On November $15,2024,$ in order to reduce the foreign exchange risk associated with the order, Passion entered into a forward exchange contract to receive $2,000,000$ on March $14,2025.$ Passion has chosen not to apply hedge accounting. Passion has a December $31$ year end. Passion uses the gross method to record the forward contract transactions and all necessary journal entries have been made up to the settlement date.

The relevant exchange spot rates and forward rates for contracts settling on March $14,2025$ are:

Spot rate

Forward rates$*$

November $15,2024$

$1=$

$1\mathrm{.}375$

$1\mathrm{.}412$

December $31,2024$

$1=$

$1\mathrm{.}385$

$1\mathrm{.}430$

January $15,2025$

$1=$

$1\mathrm{.}365$

$1\mathrm{.}405$

March $14,2025$

$1=$

$1\mathrm{.}395$

n$/$a

$*$ For contracts expiring on March $14,2025$

Which of the following is correct as it relates to the Due From Broker $($Euros$)$ account?

Question $4$ options:

On March $14,2025$ the Due from Broker $($Euros$)$ account will be credited for $$2,824,000$

On March $14,2025$ the Due from Broker $($Euros$)$ account will be debited for $$2,860,000$

On March $14,2025$ the Due from Broker $($Euros$)$ account will be debited for $$2,824,000$

On March $14,2025$ the Due from Broker $($Euros$)$ account will be credited for $$2,860,000$