Max Ltd sells equipment to Star Ltd, a U.S. company on 30/01/2020 for US$250,000. Goods are invoiced in US dollars. Payment is made on 5/03/2020. The company also buys parts from the USA, also invoiced in US$, value US$187,500 on 20/4/2020. The functional currency of Max Ltd is AUD$. As at 30/06/2020, this debt unpaid. Rates: 30/01 – A$1 = US$0.93 5/03 – A$1 = US$0.92 20/4 – A$1 = US$0.94 30/6 – A$1 = US$0.91 Required: SHOW YOUR WORKINGS Prepare journal entries for the above transactions. (Round answers to the nearest dollar, e.g. $200,263.57 = $200,264).
Q: 1.Orange County Chrome Company manufactures three chrome-plated products-automobile bumpers, valve…
A: Overhead is the amount of money incurred by the entity on the production of the goods. This cost is…
Q: Required information Problem 4-30 (LO 4-1) (Algo) [The following information applies to the…
A: Increase in the value of a capital asset and the amount that is realized when the asset is sold off.…
Q: How does management accounting helps in planning and control
A: Management accounting plays a crucial role in planning and control within an organization in the…
Q: Real accounts are more commonly referenced as accounts
A: Accounts are usually of three types;RealPersonal Nominal.All three types include different accounts…
Q: Question 28 Z Company engaged in the following transactions during the month of March: Paid $3,200…
A: Journal entries recording is the first step in accounting cycle process. Under making journal…
Q: Pearl Alvarez is investing $323,200 in a fund that earns 8% interest compounded annually.…
A: Annuity is a series of payments made at equal intervals to get the benefits.In this problem, we are…
Q: Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Assets:…
A: Cash flow statement :— It is one of the financial statements that shows change in cash and cash…
Q: Marin Company produces two software products (Cloud-X and Cloud-Y) in two separate departments (A…
A: Lets understand the basics.In direct method, cost of service departments are directly allocated to…
Q: Kristi operates a nail salon. Help her estimate next month's using method given the following…
A: $6,668Total costs would be if 1,350 customer = $6,668
Q: A deceased client's son walks into your office. His father's life was insured for $10 million and he…
A: The government imposes an estate tax, often known as inheritance tax or death tax, on the value of a…
Q: Dr. Erica Chan, MD owns EC Health Clinic. She prepares annual financial statements and has a…
A: The journal entries are prepared to record the transactions on regular basis. The adjustment entries…
Q: ANSWER ASAP Edman Corporation showed the following normal balances at the end of its first ye Cash…
A: The trial balance is prepared using the ending balance of all the T-accounts of the business. The…
Q: Not all types of income are subjected to income tax. Provide with an example the types of income…
A: The Income Tax Act 1967 is a piece of legislation in Malaysia that governs the taxation of income.…
Q: Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley…
A: The bonds payable are the long term liabilities for the business. The premium on bonds payable is…
Q: Amy purchased a passenger automobile in 2021 for $53.000. She used it 75% for her business and 25%…
A: Depreciation is the process of allocating the cost of a tangible asset over its useful life. It…
Q: Checkers Company constructed a building at a total actual cost of $14,000,000. During the…
A: Capitalized cost of asset consists of acquisition cost of asset and other costs are incurred before…
Q: In which building would you recommend that Sarasota Inc. locate, assuming a 10% cost of funds?…
A: Net Present Value (NPV) is the difference between the present value of cash inflows and the present…
Q: Dillon Products manufactures various machined parts to customer specifications. The company uses a…
A: As per the Honor code of Bartleby we are bound to give the answer of the first three sub parts only,…
Q: restaurant budgets 24% of sales for variable costs, 12% for fixed costs, and 5% for profit. One of…
A: The real pricing approach determines the price by taking into account precise and verified cost…
Q: At December 31, 2025 and 2024, Oriole Corp. had 171000 shares of common stock and 12000 shares of…
A: Earnings per share (EPS) is a financial ratio used to evaluate the profitability of a company on a…
Q: As Elaine Black reflects on her meeting with Jim Saxton and Peter Greyton, she considers where the…
A: An order- entry system, frequently appertained to as an order processing system, is a motorized or…
Q: Robinson Products Company has two service departments (S1 and 52) and two production departments (P1…
A: A corporation has a large number of departments, some of which are major departments where the bulk…
Q: The following are the ending balances of accounts at December 31, 2024, for the Valley Pump…
A: Financial statement that provides a snapshot of an organization's financial position at a specific…
Q: ABC Manufacturing uses a predetermined overhead rate of $18.40 per direct labor-hour. This…
A: OVERAPPLIED OVERHEADOverapplied Overhead occurs when Company's Budgeted Overhead is more than…
Q: Teal Mountain Company is a manufacturer of smartphones. Its controller resigned in October 2022. An…
A: Cost of goods manufactured schedule is the one in which we calculate the total cost that incurred…
Q: Pane Corp. manufactures and sells a nutrition drink for children. It wants to develop a standard…
A: Lets understand the basics.Standard cost is calculated by the entity in order to compare it with…
Q: EXERCISE 2 Fill in the missing information on the cost of goods manufactured schedule of Noland…
A: “Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: MyTel Corp. Internet service provider, has prospered during the past seven years, and recently the…
A: Stock split and stock dividend both are corporate actions, however the purposes of both the actions…
Q: 2019 April RM 1 Received RM3,000 as the petty cash float. 5 Cleaning expenses 400 6 Postage stamps…
A: Lets understand the basics.Petty cash is prepared from the main cashbook to meet daily routine small…
Q: Belami Company manufactures both shampoo and conditioner, with each product manufactured in separate…
A: It overheads is a cost allocation method used in accounting and cost accounting to distribute…
Q: The following cost data relate to the manufacturing activities of ABC Company during the just…
A: Direct costs are those costs that are directly related to a particular cost object.Direct material…
Q: Indirect Method- Preparing a Statement of Cash Flows The accounting records of Guci Corp. show the…
A: The cash flow statement is one prepared to depict cash movement from and in the business from three…
Q: Myka purchased a new office desk for her consulting business. She paid $3,300 on March 17, 2021, and…
A: It is the amount of reduction in the value of a tangible fixed asset due to tear and wear,…
Q: ABC Inc. has provided the following data for the month of May. There were no beginning inventories;…
A: Journal Entry :— It is an act of recording transactions in books of account when transaction…
Q: Blue Spruce Corp. erected and placed into service an offshore oil platform on January 1, 2023, at a…
A: Asset Retirement Obligation (ARO) account is created for assets that are supposed to be removed and…
Q: Problem 23-3A Rudd Clothiers is a small company that manufactures tall-men's suits. The company has…
A: Standard cost is the cost the company expects will be incurred for direct materials, direct labor,…
Q: In 2022, Elaine paid $2,800 of tuition and $600 for books for her dependent son to attend State…
A: Families who provide financial assistance to their children or dependents for their first four years…
Q: Effect of Doubtful Accounts on Net Income During its first year of operations, Mack's Plumbing…
A: Doubtful accounts, also known as doubtful debt or bad debt, refers to the portion of a company's…
Q: Entity F has current assets of $900,000 and current liabilities of $450,000. If the company pays an…
A: This is a liquidity ratio. This is the ratio of current assets to liabilities. It is calculated as…
Q: $2,000 face value trading at S2 $1,000 face value trading at $9 $1,000 face value trading at $1…
A: BOND Bond is a Financial Security which is Generally Issued by the Corporations, Government &…
Q: Meade Nuptial Bakery makes very elaborate wedding cakes to order. The company has an activity-based…
A: Variable costs are costs that vary with the change in the level of output whereas fixed costs are…
Q: Whitman Company has just completed its first year of operations. The company's absorption costing…
A: The contribution margin is calculated as difference between sales and variable costs. The net income…
Q: The following information, based on the 12/31/2021 Annual Report to Shareholders of Krafty Foods ($…
A: Balance sheet is one of the parts of the financial statement. It shows the financial position of the…
Q: Hoot Enterprises buys a warehouse for $590,000 to use for its East Coast distribution operations. On…
A: Accounting principles are those rules and regulations which are being used by the accountants at the…
Q: Prepare an account form of statement of financial position on December 31,2017 with appropriate…
A: An account type statement of financial statement is the statement or an account type in which from…
Q: The following T-accounts indicate the effects of normal business transactions: Debit 1/1 Equipment…
A: The T-accounts are prepared by posting the transactions to the specific accounts of the business.…
Q: Rutland Business Services (RBS) provides miscellaneous consulting and services to local businesses.…
A: Revenue: Revenue, often referred to as sales or income, is the total amount of money earned by a…
Q: Grier & Associates maintains its records on the cash basis. You have been engaged to convert its…
A: The income statement is prepared to record the revenue and expenses for the current period. Using…
Q: Calico Corporation produced 2.000 units in Job 903. The following data Direct materials used Direct…
A: Gross profit is the amount of money earned by the entity. It is determined by deducting cost of…
Q: Cap Incorporated manufactures ball point pens that sell at wholesale for $0.80 per unit. Budgeted…
A: The gross margin is calculated as the difference between the revenue and cost of goods sold. The net…
Max Ltd sells equipment to Star Ltd, a U.S. company on 30/01/2020 for US$250,000. Goods are invoiced in US dollars. Payment is made on 5/03/2020. The company also buys parts from the USA, also invoiced in US$, value US$187,500 on 20/4/2020. The functional currency of Max Ltd is AUD$. As at 30/06/2020, this debt unpaid. Rates: 30/01 – A$1 = US$0.93 5/03 – A$1 = US$0.92 20/4 – A$1 = US$0.94 30/6 – A$1 = US$0.91
Required: SHOW YOUR WORKINGS Prepare
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
- On September 30, 2020, Chicken Ltd., a Canadian company, entered into a contract to purchase goodsfrom Wing Ltd., a foreign corporation. The terms of the contract call for the goods to be delivered toChicken Ltd.'s Edmonton location on May 30, 2021. The cost of goods is EUR $1,000,000 to be settled onJuly 31, 2021. On September 30, 2020, Chicken Ltd. also arranged for a forward contract through its bank for EUR$1,000,000. The goods were delivered on time, and Chicken Ltd, settled with Wing Ltd. on July 31, 2021.Chicken Ltd. has a April 30 year-end.The spot and forward rates are as follows: Spot Rate ($CAD)1 USD = x.xX CAD Forward Rate($CAD)1 USD = XXX CAD September 30, 2020 $1.42 $1.46 April 30, 2021 $1.44 $1.48 May 30, 2021 $1.45 $1.49 July 31, 2021 $1.50 $1.50 RequiredPrepare Chicken Ltd.'s journal entries to reflect the above assuming that:a. the hedge is a cash flow hedge, andb. the hedge is a fair value hedge.Local Corp imported a heavy machine from the US for US$50,000 on October 10, 2019. A letter of credit was opened with a Makati branch based on the commercial invoice for US$50,000, on which Local Corpl made a 100% deposit cover based on the exchange rate of $1.00 to P27.50. Shipment of the heavy machine was effected on December 30, 2019, at which time the exporter collected the proceeds of the letter of credit when the prevailing exchange rate was $1.00 to P28.00. From the exchange rate fluctuation, Local Corp realized: Group of answer choices A. P25,000 gain B.P25,000 loss C. P5,000 gain D. No gain, No lossA company located in the USA, which has the dollar as its functional currency, purchased inventory on February 1 in Vietnam for 10,000,000 dongs with a payment date of April 1. One dong can be exchanged for $0.01 on February 1, and one dong can be exchanged for $0.12 on April 1. On April 1, the company pays off the 10,000,000-dong debt from the purchase of inventory. When the US company presents its financial statements, which of the following statements is false? The business should file with the statement a gross profit of $110,000. No profit is recognized related to inventory A loss of $20,000 is reported as a result of accounts payable Cost of goods sold is reported at $120,000
- Doering Company, a U.S. corporation with customers in several foreign countries, had the following selected transactions for 2019 and 2020. 2019 Apr. 8 Sold merchandise to Salinas & Sons of Mexico for $5,938 cash. The exchange rate for pesos is $0.1043 on this day. July 21 Sold merchandise on credit to Sumito Corp. in Japan. The price of 1.5 million yen is to be paid 120 days from the date of sale. The exchange rate for yen is $0.0094 on this day. Oct. 14 Sold merchandise for 19,000 pounds to Smithers Ltd. of Great Britain, payment in full to be received in 90 days. The exchange rate for pounds is $1.4566 on this day. Nov. 18 Received Sumito’s payment in yen for its July 21 purchase and immediately exchanged the yen for dollars. The exchange rate for yen is $0.0092 on this day. Dec. 20 Sold merchandise for 17,000 ringgits to Hamid Albar of Malaysia, payment in full to be received in 30 days. On this day, the exchange rate for ringgits is $0.4501. Dec. 31 Recorded adjusting entries…Apex Ltd, is a computer software manufacturing company based in the United States of America (USA). On 1st January 2019, it sold goods worth K10,000.00 to Electro Computers, a company based in Zambia. Electro computers Ltd paid for the software in June 2019. The prevailing exchange rates were:January 2019: K12:00 : US $ 1.00June 2019: K12:30 : US $ 1.00Required:Show how the necessary accounting entries for the transaction will be reflected in the books of each company.Leigh of New York sells its products to customers in the United States and the United Kingdom. On December 16, 2019, Leigh sold merchandise on credit to Bronson Ltd. of London at a price of 17,000 pounds. The exchange rate on that day for £1 was $1.4583. On December 31, 2019, when Leigh prepared its financial statements, the rate was £1 for $1.4382. Bronson paid its bill in full on January 15, 2020, at which time the exchange rate was £1 for $1.4482. Leigh immediately exchanged the 17,000 pounds for U.S. dollars. Prepare Leigh’s journal entries on December 16, December 31, and January 15 (round to the nearest dollar).
- Wolters Corporation is a U.S. corporation that purchased 50,000 chocolate bars from a foreign manufacturer on March 1, 2024 for 80,000 foreign currency units, to be paid on April 30, 2024. On March 1, 2024 Wolters also entered into a forward contract to purchase 80,000 foreign currency units on April 30, 2024. Wolters has a March 31 year end. Exchange rates are as follows: Date Spot Rate Forward Rate 3/1/24 $0.69 $0.65 3/31/24 $0.61 $0.63 4/30/24 $0.66 $0.66 Required: Prepare the journal entries to record the transactions through April 30, 2024. March 31 is the fiscal period end. Ignore the split between spot gain/loss and time value. Apex Ltd, is a computer software manufacturing company based in the United States of America (USA). On 1st January 2019, it sold goods worth Kn10,000.00 to Electro Computers, a company based in Zambia. Electro computers Ltd paid for the software in June 2019. The prevailing exchange rates were: January 2019: Kn12:00 : US $ 1.00 June 2019: Kn 12:30 : US $ 1.00 Required: Show how the necessary accounting entries for the transaction will be reflected in the books of each company.At the end of 2020, an Italian subsidiary of a U.S. parent reports €1,000,000 in equipment purchased when the exchange rate was $1.40, and €3,000,000 in equipment purchased when the exchange rate was $1.50. The average exchange rate for 2020 is $1.35, and the beginning and ending rates for 2020 are $1.42 and $1.31, respectively. If the Italian subsidiary’s functional currency is the U.S. dollar, the equipment account, in U.S. dollars, is a. $5,240,000 b. $5,350,000 c. $5,400,000 d. $5,900,000
- Harris Incorporated had the following transactions: On May 1, Harris purchased parts from a Japanese company for a U.S. dollar–equivalent value of $7,000 to be paid on June 20. The exchange rates were May 1 1 yen = $0.0070 June 20 1 yen = 0.0075 On July 1, Harris sold products to a Brazilian customer for a U.S. dollar equivalent of $10,400, to be received on August 10. Brazil’s local currency unit is the real. The exchange rates were July 1 1 real = $0.20 August 10 1 real = 0.22 Required: Assume that the two transactions are denominated in U.S. dollars. Prepare the entries required for the dates of the transactions and their settlement in U.S. dollars. Assume that the two transactions are denominated in the applicable LCUs of the foreign entities. Prepare the entries required for the dates of the transactions and their settlement in the LCUs of the Japanese company (yen) and the Brazilian customer (real).(a) ABC Co has a year end of 31 December 20X1 and uses the dollar ($) as its functional currency. On 25 October 20X1 ABC Co buys goods from a Swedish supplier for Swedish Krona (SWK) 286,000. Rates of exchange: 25 October 20X1 $1 = SWK 11.16 16 November 20X1 $1 = SWK 10.87 31 December 20X1 $1 = SWK 11.02 Required: Show the accounting treatment for the above transactions if: (a) A payment of SWK286,000 is made on 16 November 20X1. (b) The amount owed remains outstanding at the year-end date.Spindler, Inc. (a U.S.-based company), imports surfboards from a supplier in Brazil and sells them in the United States. Purchases are denominated in terms of the Brazilian real (BRL). During 2020, Spindler acquires 320 surfboards at a price of BRL 1,600 per surfboard, for a total of BRL 512,000.00. Spindler will pay for the surfboards when it sells them. Relevant exchange rates are as follows: Date U.S. Dollar perBrazilian Real (BRL) September 1, 2020 $ 0.220 December 1, 2020 0.210 December 31, 2020 0.230 March 1, 2021 0.215 Assume that Spindler acquired the surfboards on September 1, 2020, and made payment on December 1, 2020. What is the effect of the exchange rate fluctuations on reported income in 2020? Assume that Spindler acquired the surfboards on December 1, 2020, and made payment on March 1, 2021. What is the effect of the exchange rate fluctuations on reported income in 2020 and 2021? Assume that Spindler acquired the surfboards on…