ADVANCED FINANCIAL ACCOUNTING-ACCESS
12th Edition
ISBN: 9781260518740
Author: Christensen
Publisher: MCG
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Textbook Question
Chapter 11, Problem 11.8E
Chocolate De−lites imports and exports chocolate delicacies. Some transactions are denominated in U.S. dollars and others in foreign currencies. A summary of
The spot rates on December 31, 20X6, were
E€1 = $0.176
¥1 = $0.0081
The average exchange rates during the collection and payment period in 20X7 are
E€1 = $0.18
¥1 = $0.0078
Required
a. Prepare the adjusting entries on December 31, 20X6.
b. Record the collection of the accounts receivable in 20X7.
c. Record the payment of the accounts payable in 20X7.
d. What was the foreign currency gain or loss on the accounts receivable transaction denominated in E€ for the year ended December 31, 20X6? For the year ended December 31, 20X7? Overall for this transaction?
e. What was the foreign currency gain or loss on the accounts receivable transaction denominated in ¥? For the year ended December 31, 20X6? For the year ended December 31, 20X7? Overall for this transaction?
f. What was the combined foreign currency gain or loss for both transactions? What could Chocolate De-lites have done to reduce the risk associated with the transactions denominated in foreign currencies?
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Students have asked these similar questions
Cassowary Corporation’s balance sheet at December 31, 2016 included a $20,400 account receivable from Quail Corporation of Australia. The account receivable is denominated as 30,000 Australian dollars (A$). Assuming no entries have been made since 12/31/2016, what single entry should Cassowary make on January 16, 2017 when the account receivable is collected and the exchange rate for A$ is $.67?
Select one:
a.
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20,100
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b.
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c.
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d.
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20,700
Accounts Receivable (fc)
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Accounting for foreign currency - denominated receivables and payables - multiple years
The accounts of Lin, a U.S. corporation, show $81,300 accounts receivables and $38,900 accounts payable at December 31, 2016, before adjusting entries are made. An analysis of the balances reveals the following
Accounts Receivable
Receivable Dominated in US dollars $28,500
Receivable Dominated in 20,000 Swedish krona $11,800
Receivable Dominated in 25,000 British pounds $41,000
Total $81,300
Accounts Payable
Payable dominated in US dollars $6,850
Payable dominated in 10,000 canadian dollars $7,600
Payable dominated in 15,000 British pounds $24,450
Total $38,900
Current exchange rates for Swedish krona,…
Chapter 11 Solutions
ADVANCED FINANCIAL ACCOUNTING-ACCESS
Ch. 11 - Prob. 11.1QCh. 11 - Prob. 11.2QCh. 11 - The U.S. dollar strengthened against the European...Ch. 11 - Prob. 11.4QCh. 11 - Prob. 11.5QCh. 11 - How are assets and liabilities denominated in a...Ch. 11 - Prob. 11.7QCh. 11 - Prob. 11.8QCh. 11 - Prob. 11.9QCh. 11 - Distinguish between an exposed net asset position...
Ch. 11 - Prob. 11.11QCh. 11 - Prob. 11.12QCh. 11 - Effects of Changing Exchange Rates Analysis Since...Ch. 11 - Prob. 11.2CCh. 11 - Prob. 11.5CCh. 11 - Prob. 11.1ECh. 11 - Prob. 11.2ECh. 11 - Basic Understanding of Foreign Exposure The...Ch. 11 - Prob. 11.5ECh. 11 - Prob. 11.6ECh. 11 - Prob. 11.7ECh. 11 - Adjusting Entries for Foreign Currency Balances...Ch. 11 - Prob. 11.9ECh. 11 - Prob. 11.10ECh. 11 - Prob. 11.11.1ECh. 11 - Prob. 11.11.2ECh. 11 - Prob. 11.11.3ECh. 11 - Prob. 11.11.4ECh. 11 - Prob. 11.11.5ECh. 11 - Prob. 11.11.6ECh. 11 - Prob. 11.11.7ECh. 11 - Prob. 11.12ECh. 11 - Prob. 11.13ECh. 11 - Prob. 11.14.1ECh. 11 - Foreign Currency Transactions [AICPA Adapted]...Ch. 11 - Prob. 11.14.3ECh. 11 - Prob. 11.14.4ECh. 11 - Prob. 11.14.5ECh. 11 - Foreign Currency Transactions [AICPA Adapted]...Ch. 11 - Prob. 11.14.7ECh. 11 - Prob. 11.15ECh. 11 - Prob. 11.16AECh. 11 - Prob. 11.17ECh. 11 - Prob. 11.18ECh. 11 - Prob. 11.19.1ECh. 11 - Prob. 11.19.2ECh. 11 - Prob. 11.19.3ECh. 11 - Prob. 11.19.4ECh. 11 - Prob. 11.19.5ECh. 11 - Prob. 11.20.1PCh. 11 - Prob. 11.20.2PCh. 11 - Prob. 11.20.3PCh. 11 - Prob. 11.20.4PCh. 11 - Prob. 11.20.5PCh. 11 - Foreign Sales Tex Hardware sells many of its...Ch. 11 - Prob. 11.22PCh. 11 - Prob. 11.23.1PCh. 11 - Prob. 11.23.2PCh. 11 - Prob. 11.24PCh. 11 - Prob. 11.25PCh. 11 - Prob. 11.26PCh. 11 - Prob. 11.27.1PCh. 11 - Prob. 11.27.2PCh. 11 - Prob. 11.27.3PCh. 11 - Prob. 11.28APCh. 11 - Prob. 11.29.1BPCh. 11 - Prob. 11.29.2BPCh. 11 - Prob. 11.29.3BPCh. 11 - Prob. 11.29.4BPCh. 11 - Prob. 11.29.5BPCh. 11 - Prob. 11.29.6BPCh. 11 - Prob. 11.30BPCh. 11 - Prob. 11.31BPCh. 11 - Matching Key Terms Match the items in the lefthand...
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