If a U.S.company purchases goods for a fixed number of British pounds,and the exchange rate has fallen from $1.55 per pound to $1.50 per pound by the time payment is made,the U.S.company would record an exchange gain.

Question

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Because the exchange rate fell from $1.55 to $1.50 per pound, the U.S. company pays less in USD for the same amount of goods priced in pounds, resulting in an exchange gain.

If a USCompany Purchases Goods for a Fixed Number of British Pounds,and