Chegg "Hayden, Inc. purchased knobs from a Greek company for 188,000 Euros. On the purchase date the exchange rate was $0.80 per Euro, but when Hayden paid the liability, the exchange rate was $0.70 per Euro. When this foreign account payable was paid, Hayden, Inc., recorded a:"

Therefore, there was a gain of €18,800

Explanation:

From the question, we are informed that Hayden, Inc. purchased knobs from a Greek company for 188,000 Euros and that on the purchase date the exchange rate was $0.80 per Euro, but when Hayden paid the liability, the exchange rate was $0.70 per Euro.

When this foreign account payable was paid, Hayden, Inc., recorded a:

= (€188,000 × 0.80) - (€188,000 × 0.70)

= €150400 - €131600

= €18,800

Therefore, there was a gain of €18,800