Recording Import Transactions Pinnacle Foods imports a variety of items for resale to U.S. retail‑ ers. Following is a description of purchases and foreign‑currency‑denominated payments made in the last accounting period, plus the direct exchange rates for each date: Country Amount Currency Spot rate at purchase Spot rate at payment Australia . . . . . . . . . . . . . . . . . . 200,000 Australian dollar $0.7600 $0.7300 Thailand . . . . . . . . . . . . . . . . . . 800,000 Baht 0.0345 0.0365 Hong Kong . . . . . . . . . . . . . . . . 5,000,000 Hong Kong dollar 0.1319 0.1362 Jordan . . . . . . . . . . . . . . . . . . . 500,000 Dinar 1.4100 1.3900 Required Prepare the journal entries made by Pinnacle, a U.S. company, to record the above purchase and payment transaction.

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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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Recording Import Transactions Pinnacle Foods imports a variety of items for resale to U.S. retail‑
ers. Following is a description of purchases and foreign‑currency‑denominated payments made in the last
accounting period, plus the direct exchange rates for each date:
Country Amount Currency
Spot rate at
purchase
Spot rate
at payment
Australia . . . . . . . . . . . . . . . . . . 200,000 Australian dollar $0.7600 $0.7300
Thailand . . . . . . . . . . . . . . . . . . 800,000 Baht 0.0345 0.0365
Hong Kong . . . . . . . . . . . . . . . . 5,000,000 Hong Kong dollar 0.1319 0.1362
Jordan . . . . . . . . . . . . . . . . . . . 500,000 Dinar 1.4100 1.3900
Required
Prepare the journal entries made by Pinnacle, a U.S. company, to record the above purchase and payment transaction.

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