Currency transactions and exchange rate changes


Problem: Which of the following combinations correctly describes the relationship between foreign currency transactions, exchange rate changes, and foreign exchange gains and losses?

Foreign Exchange

Type of Transaction Foreign Currency Gain or Loss

a. Export sale Appreciates Loss

b.Import purchase Appreciates Gain

c.Import purchase Depreciates Gain

d. Export sale Depreciates Gain

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Finance Basics: Currency transactions and exchange rate changes
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