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On May 1,2024, Mosby Company received an order to sell a machine to a customer...

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Accounting

On May 1,2024, Mosby Company received an order to sell a machine to a customer in Canada at a price of 2,000,000 Mexican pesos. The machine was shipped, and payment was received on March 1,2025. On May 1,2024, Mosby purchased a put option giving it the right to sell 2,000,000 pesos on March 1,2025, at a price of $190,000. Mosby properly designates the option as a fair value hedge of the peso firm commitment. The option cost $3,000 and had a fair value of $3,200 on December 31,2024. The following spot exchange rates apply:DateSpot RateMay 1,2024$ 0.095December 31,2024$ 0.094March 1,2025$ 0.089What was the impact on Mosby's 2024 net income as a result of this fair value hedge of a firm commitment?Group of answer choices$1,800 decrease$2,000 decrease$2,200 decrease$1,800 increase$2,200 increase

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