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- On 1 December 2019, Company EX, with a functional currency and presentation currency in HKD, sold and deliver an inventory to a customer in Paris at EUR10,000. EX has received the money only in 2020. Exchange rate of EUR/HKD was 8.79 and 8.96 respectively on 1 December 2019 and 31 December 2019. Required: Prepare the journal entries for EX in HKD for the year ended 31 December 2019Problem 2: Old Colonial Corp. (a U.S. company) made a sale to a foreign customer on September 15, 2018, for 100,000 stickles. Payment was received on October 15, 2018. The following exchange rates applied: Date Rate Date Rate Date Rate Sept. 15, 2018 51-5.48 Sept 30, 2018 51-5.50 Oct. 15, 2018 51-5.44 Required: Prepare all journal entries for Old Colonial Corp. in connection with this sale assuming that the company closes its books on September 30 to prepare interim financial statements.1 . PL Co purchased goods on credit from a US supplier costing $US 225,000 on 5th June 2020 when the exchange rate was A$1 = US0.69 . On 30 June 2020, balance date , the exchange rate was A$1 = US0.72 . PL Co paid the US supplier on 7th July 2020 when the exchange rate was A$1 = 0.74. Required : Prepare the journal entries for the above
- Brandlin company of anaheim, california sells parts to a foreign customer on december 1, 2017, with payment of 24,000 korunas to be received on march 1, 2018. Breanlin enters into a forward contract on december 1, 2017, to sell 24,000 korunas on march 1, 2018. Relevant exchange rates for the koruna on various dates are as follow: Date Spot Rate Forward Rate December 1, 2017 4.20 4.275 December 31, 2017 4.30 4.400 March 1, 2018 4.45 N/A 1. Assuming that Brandlin designates the forward contract as a fair value hedge of a foreign currency receivable, prepare journal entries for these transactions in US dollars. 2. What is the impact on 2017 net income? 3. What is the impact on 2018 net income? What is the impact on net income over the two accounting periods?Brandlin company of anaheim, california, sells parts to a foreign customer on december 1, 2017, with payment of 24,000 korunas to be received on march 1, 2018. Brandlin enters into a forward contact on december 1, 2017 to sell 24,000 korunas on march 1, 2018. Relevant exchange rates for the korunas on various dates are as follow: date spot rate forward rate december 1, 2017 4.20 4.275 december 31, 2017 4.30 4.400 march 1, 2018 4.45 n/a brandli's incremental borrowing rate is 12 percent. The present value factor for two months at annual interest rate of 12 percent (1 percent per month) is 0.9803. Brandlin must close its books and prepare financial statements at december 31. 1. Assuming that brandlin designates the forward contract as a cash flow hedge of a foreign currency receivable and recognizes any premium or discount…On September 1, 2020, Creed Co. sold merchandise to a foreign entity for 250,000 francs. Terms of the sale require payment in francs on February 1, 2021. On September 1, 2020, the spot exchange rate was P1.2 per franc. On December 31, 2020, the spot rate was P1.19, but the rate increased to P1.22 by February 1, 2021, when payment was received. Required: Provide journal entries in 2020 and 2021.
- Accounting Car Corp. (a U.S.-based company) sold parts to a Japanese customer on December 1, 2020, with payment of 10 million Japanese yen to be received on January 31, 2021. The following exchange rates applied: Date Spot rate Forward rate to 01/31/21 0.00090 0.00093 0.00092 0.00098 0.00095 December 1, 2020 December 31, 2020 January 31, 2021 Assuming a forward contract was entered into, what would be the net impact on Car Corp.'s 2020 income statement related to this foreign currency transaction? Assume an annual interest rate of 12% and a fair value hedge. The present value for one month at 12% is .9901. A. $295.05 (loss). B. $ 300 (gain). C. $ 300 (loss). D. $ 700 (gain). E. $ 700 (loss). 0.00095Brandlin Company of Anaheim, California, sells parts to a foreign customer on December 1, 2017, with payment of 16,000 korunas to be received on March 1, 2018. Brandlin enters into a forward contract on December 1, 2017, to sell 16,000 korunas on March 1, 2018. Relevant exchange rates for the koruna on various dates are as follows: Date Spot Rate Forward rate (to march 1, 2018) December 1 , 2017 $2.70 $2.775 December 31 , 2017 2.80 2.900 March 1, 2018 2.95 N/A Brandlin’s incremental borrowing rate is 12 percent. The present value factor for two months at an annual interest rate of 12 percent (1 percent per month) is 0.9803. Brandlin must close its books and prepare financial statements at December 31.a. Assuming that Brandlin designates the forward contract as a cash flow hedge of a foreign currency receivable and recognizes any premium or discount using the straight-line method, prepare journal entries for these transactions in U.S. dollars. What is the impact on 2017 net…Brandlin Company of Anaheim, California, sells parts to a foreign customer on December 1, 2017, with payment of 16,000 korunas to be received on March 1, 2018. Brandlin enters into a forward contract on December 1, 2017, to sell 16,000 korunas on March 1, 2018. Relevant exchange rates for the koruna on various dates are as follows: Date Spot Rate Forward Rate(to March 1, 2018) December 1, 2017 $ 3.40 $ 3.475 December 31, 2017 3.50 3.600 March 1, 2018 3.65 N/A Brandlin's incremental borrowing rate is 12 percent. The present value factor for two months at an annual interest rate of 12 percent (1 percent per month) is 0.9803. Brandlin must close its books and prepare financial statements at December 31. a-1. Assuming that Brandlin designates the forward contract as a cash flow hedge of a foreign currency receivable and recognizes any premium or discount using the straight-line method, prepare journal entries for these transactions in U.S.…
- D Company purchases 80,000 US dollars under a forward contract dated November 1, 2020, for delivery on January 31, 2021. The following are the direct exchange rates of a US dollar: 11/01/2020 12/31/2020 01/31/2021 Spot rates 45.75 44.90 44.5030-day forward 44.30 46.15 43.2060-day forward 47.65 44.30 45.7590-day forward 45.25 45.45 44.10 If the forward contract is a hedge of an import transaction of $80,000 dated November 1, 2020, payable on January 31, 2021, how much forex gain should the company report on its December 31, 2020 statement of comprehensive income?On July 1, 2020, a Filipino entity whose functional currency is Philippine Peso purchased on account inventories at a cost of $100 to be paid on June 30, 2021. On October 1, 2020, the said inventories were soid on account by the Filipino entity at a selling price of $150 to be collected on September 30, 2021. The following direct foreign exchange rates are given: July 1,2020 October 1, 2020 December 31, 2020 Buying Spot P40 P42 P45 Selling Spot P50 P48 P52 56. What is the gross profit to be reported by the Filipino entity for the year ended December 31, 2020? a. 1,300 b. 2,100 c. 2,400 d. 3,200 57. what is the net foreign currency gain or loss for the year ended December 31, 2020? a. 150 net gain b. 250 net gain c. (350) net loss d. (50) net loss2.Jameson Ltd purchased goods on credit from a European supplier costing Euros 80,000 on 29th May 2020 when the exchange rate was A$1 = O.78 Euros. At 30th June 2020, its balance date . the exchange rate was A$1 = 0.79 Euros . Jameson Ltd paid the European supplier on 5th July 2020 when the exchange rate was A$1= 0.76 Euros Required: Prepare the journal entries for the above
