A company that has foreign currency transactions will have foreign currency rece

A company that has foreign currency transactions will have foreign currency receivables and/or foreign currency payables. If the direct exchange rate decreases while a company has a foreign currency payable the company will record a gain. Assume that when I was explaining this concept in class a student did not quite understand it. Write a short simple explanation that would best explain this concept to this student. Use a memo format.Please provide a complete easy-to-understand explanation as concisely as possible. Your explanation should not exceed two short paragraphs.