Mr. Adeel operate his dry fruit business in dubai. On 1st july, 2021, mr adeel exports dry fruit worth of 15000 UAED to Mr. Ehsaan ullah in United Kingdom when exchange rate was 1 UAED= 0.12 pound. Mr. Ehsaan ullah made payments on 31st November, 2021 when exchange rate was 1 UAED= 0.14 pound. Mr. adeel close account on 31st Dec each year. (IAS-21 effects on foreign exchange rate) Required: a) What would effect of foreign exchange rate on Mr. Adeel financial statement. b) What would effect of foreign exchange rate on Mr. Ehsaan ullah financial statement.
Mr. Adeel operate his dry fruit business in dubai. On 1st july, 2021, mr adeel exports dry fruit worth of 15000 UAED to Mr. Ehsaan ullah in United Kingdom when exchange rate was 1 UAED= 0.12 pound. Mr. Ehsaan ullah made payments on 31st November, 2021 when exchange rate was 1 UAED= 0.14 pound. Mr. adeel close account on 31st Dec each year. (IAS-21 effects on foreign exchange rate) Required: a) What would effect of foreign exchange rate on Mr. Adeel financial statement. b) What would effect of foreign exchange rate on Mr. Ehsaan ullah financial statement.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Mr. Adeel operate his dry fruit business in dubai. On 1st july, 2021, mr adeel exports dry fruit worth of 15000 UAED to Mr. Ehsaan ullah in United Kingdom when exchange rate was 1 UAED= 0.12 pound. Mr. Ehsaan ullah made payments on 31st November, 2021 when exchange rate was 1 UAED= 0.14 pound. Mr. adeel close account on 31st Dec each year.
(IAS-21 effects on foreign exchange rate)
Required:
a) What would effect of foreign exchange rate on Mr. Adeel financial statement.
b) What would effect of foreign exchange rate on Mr. Ehsaan ullah financial statement.
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