The difference between the current spot price and the futures price is known as the

Assume IBM enters into a forward contract to purchase 200,000 euros at a rate of $1.90/euro one year from today. If the spot exchange rate is $2/euro one year later, what is the dollar amount that IBM must pay to receive the euros?

A) $300,000 B) $325,000 C) $380,000 D) $400,000

Which of the following costs associated with a delivery van should NOT be capitalized?

A) The van's engine is overhauled and this will extend the useful life by five years. B) The van is modified so it can be used for multiple purposes in the business. C) The van is repainted. D) All of the above items should be capitalized.