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[The following information applies to the questions displayed below.] Select the correct answer for each of the following questions. Note: Items 3 through 5 are based on the following: On December 12, 20X5, Dahl Company entered into three forward exchange contracts, each to purchase 100,000 francs in 90 days. The relevant exchange rates are as follows:

	Spot Rate				Forward Rate for March 12, 20X6
December 12, 20X5		$	0.88			$	0.90
December 31, 20X5			0.98				0.93

3. Dahl entered into the first forward contract to manage the foreign currency risk from a purchase of inventory in November 20X5, payable in March 20X6. The forward contract is not designated as a hedge. At December 31, 20X5, what amount of foreign currency transaction gain should Dahl include in income from this forward contract?

multiple choice

$5,000

$10,000

$3,000

$0

Required information [The following information applies to the questions displayed below.] Select the correct answer for each of the following questions. Note: Items 3 through 5 are based on the following: On December 12, 20X5, Dahl Company entered into three forward exchange contracts, each to purchase 100,000 francs in 90 days. The relevant exchange rates are as follows: 3ahl entered into the first forward contract to manage the foreign currency risk from a purchase of inventory in November 205, payable in March 20X6. The forward contract is not designated as a hedge. At December 31, 20X5, what amount of foreign currency ransaction gain should Dahl include in income from this forward contract? $5,000$10,000$3,000 $0