On October 1, 20X1, Bohol Corporation, a domestic company, purchases goods on account from Kyota Company of Japan for 485,000 yen. No letter of credit is required by Bohol Corporation. The billing date for the sale is December 1, 20X1, and the payment is due in 60 days on January 30, 20X1. Because of the sale, Bohol Corporation enters into a forward contract to buy 485,000 yen from the Banco De Oro (BDO) in 60 days. The relevant exchange rates are as follows: Date Spot Rate 1 Yen = P0.47 1 Yen = P0.46 1 Yen = P0.49 Forward Rate December 1, 20X1 December 31, 20x1 January 30, 20X1 1 Yen = PO.51 1 Yen = P0.50 1 Yen = P0.49

On October 1, 20X1, Bohol Corporation, a domestic company, purchases goods on account from Kyota Company of Japan for 485,000 yen. No letter of credit is required by Bohol Corporation. The billing date for the sale is December 1, 20X1, and the payment is due in 60 days on January 30, 20X1. Because of the sale, Bohol Corporation enters into a forward contract to buy 485,000 yen from the Banco De Oro (BDO) in 60 days. The relevant exchange rates are as follows: Date Spot Rate 1 Yen = P0.47 1 Yen = P0.46 1 Yen = P0.49 Forward Rate December 1, 20X1 December 31, 20x1 January 30, 20X1 1 Yen = PO.51 1 Yen = P0.50 1 Yen = P0.49

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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