An entity based in Europe with a Euro (EUR) functional currency makes a sale of US$10,000 to a customer based in the US. The sale takes place on 5 November 2018 and is payable in USD on 11 January 2019. The year-end for the entity is 31 December 2018, and the customer settles the invoice on the due date. The following exchange rates are relevant: Date and Rate (EUR 1.00= US$) 5 November 2018: 1.244 31 December 2018: 1.355 11 January 2019: 1.333 Q3. What are the journal entries the Europe entity should make in relation to the sale, on 11 January 2019? Select one: O A. DR Cash O C. OB. DR Cash CR Accounts receivable DR Cash CR Gain on foreign exchange difference CR Accounts receivable DR Loss on foreign exchange difference CR Accounts receivable 7,502 O D. No entry is required. 7,502 7,502 122 7,380 13,330 220 13,550
An entity based in Europe with a Euro (EUR) functional currency makes a sale of US$10,000 to a customer based in the US. The sale takes place on 5 November 2018 and is payable in USD on 11 January 2019. The year-end for the entity is 31 December 2018, and the customer settles the invoice on the due date. The following exchange rates are relevant: Date and Rate (EUR 1.00= US$) 5 November 2018: 1.244 31 December 2018: 1.355 11 January 2019: 1.333 Q3. What are the journal entries the Europe entity should make in relation to the sale, on 11 January 2019? Select one: O A. DR Cash O C. OB. DR Cash CR Accounts receivable DR Cash CR Gain on foreign exchange difference CR Accounts receivable DR Loss on foreign exchange difference CR Accounts receivable 7,502 O D. No entry is required. 7,502 7,502 122 7,380 13,330 220 13,550
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Kk.91.
Transcribed Image Text:An entity based in Europe with a Euro (EUR) functional currency makes a sale of US$10,000 to a customer based in the US. The sale takes place on 5 November 2018
and is payable in USD on 11 January 2019. The year-end for the entity is 31 December 2018, and the customer settles the invoice on the due date. The following
exchange rates are relevant:
Date and Rate (EUR 1.00 US$)
5 November 2018: 1.244
31 December 2018: 1.355
11 January 2019: 1.333
Q3.
What are the journal entries the Europe entity should make in relation to the sale, on 11 January 2019?
Select one:
O A.
DR Cash
O C.
OB. DR Cash
CR Accounts receivable
DR Cash
CR Gain on foreign exchange difference
CR Accounts receivable
DR Loss on foreign exchange difference
CR Accounts receivable
7,502
O D. No entry is required.
7,502
7,502
122
7,380
13,330
220
13,550
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