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Cray Research (a U.S firm) purchased a super computer from the Max Planck Institute in...

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Accounting

Cray Research (a U.S firm) purchased a super computer from the Max Planck Institute in Germany on credit and invoiced 10 ,000,000 payable in six months. Currently, the six-month forward exchange rate is $1.295/ and the foreign exchange advisor for Cray Research predicts that the spot rate is likely to be $1.252/ in six months.

(a) What is the expected gain/loss from the forward hedging? (measured in $, and round your answer to zero decimal, e.g., $56,699).

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