AMIS624X3G - 12/1/20x1 12/31/20x2 3/30/20x2 Spot Rate $1.34...

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12/1/20x1 12/31/20x2 3/30/20x2 Option Value12/1/20x1 12/31/20x2 3/30/20x2 Spot Rate $1.34 $1.42 $1.45 Time Value $750 $600 $0 Strike Price $1.39 $1.39 $1.39 Intrinsic Valu 0 3,000 6,000 Fair Value $750 $3,600 $6,000 Total $750 $3,600 $6,000 Both Transactions Involve 100,000Euros 12/1/20x1 Inventory 134,000 12/1/20x1 FX-Contract V 750 Accounts Payable 134,000 Cash 750 12/31/20x2 FX Loss 8,000 12/31/20x2 FX-Contract V 2,850 Accounts Payable 8,000 FX Gain 2,850 3/30/20x2 FX Loss 3,000 3/30/20x2 FX-Contract V 2,400 Accounts Payable 3,000 FX Gain 2,400 Accounts Pay 145,000 Cash 6,000 Cash 145,000 FX-Contract Value 6,000
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Forward--Case to Buy Foreign Currency 10/17/20x1 12/31/20x1 1/15/20x2 F'wd Value 10/17/20x1 12/31/20x1 1/15/20x2 Spot Rate $1.69 $1.63 $1.60 Get $177,000 $165,000 $160,000 Forward Rate $1.77 $1.65 $1.60 Give 177,000 177,000 177,000 Effect/Discounting Net $0 ($12,000) ($17,000) Discounting n/a 0n/a Both Transactions Involve 100,000Pounds Value of FX $0 ($12,000) ($17,000) 10/17/20x1
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This note was uploaded on 08/06/2011 for the course AMIS 624 taught by Professor Wallin during the Summer '11 term at Ohio State.

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AMIS624X3G - 12/1/20x1 12/31/20x2 3/30/20x2 Spot Rate $1.34...

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