19,000 dinars to be made on March 1, 2021 The materials are consumed immediately and recognized as cost of goods sold at the of purchase. On December 1, 2020, Icebrcaker enters into a forward contract to purchase 19,000 dinars on March 1, 2021. Relevant exchange rates for the dinar on various cates are as follows: Forward Rate Date December 1, 2020 December 31, 2029 Harch 1, 2021 Spot Rate $ 3.70 3. 8e 3.95 (to March 1, 2021) $ 3.775 3.900 N/A a-1. Assuming that Icebreaker designates the forward contract as a cash flow hedge of a foreign currency payable, prepare journa entries for the import purchase and foreign currency forward contract in U.S. dollars. 2. What is the impact on 2020 net income? e-3. What is the impact on 2021 net income? a-4. What is the Impact on net income over the two accounting perlods? b-1. Assuming that icebreaker designates the forward contract as a fair value hedge of a foreign currency payable, prepere journal

19,000 dinars to be made on March 1, 2021 The materials are consumed immediately and recognized as cost of goods sold at the of purchase. On December 1, 2020, Icebrcaker enters into a forward contract to purchase 19,000 dinars on March 1, 2021. Relevant exchange rates for the dinar on various cates are as follows: Forward Rate Date December 1, 2020 December 31, 2029 Harch 1, 2021 Spot Rate $ 3.70 3. 8e 3.95 (to March 1, 2021) $ 3.775 3.900 N/A a-1. Assuming that Icebreaker designates the forward contract as a cash flow hedge of a foreign currency payable, prepare journa entries for the import purchase and foreign currency forward contract in U.S. dollars. 2. What is the impact on 2020 net income? e-3. What is the impact on 2021 net income? a-4. What is the Impact on net income over the two accounting perlods? b-1. Assuming that icebreaker designates the forward contract as a fair value hedge of a foreign currency payable, prepere journal

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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Kk.233.
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