Khianne Mae Obias – AM21 April 25, 2021

PROBLEM 1: IMPORTING TRANSACTIONS

COMPANY A:

9/15/2017 Purchase 200,000

Cash 200,000

COMPANY B:

10/15/2017 Purchases (10,000 x 39.40) 394,000

Cash 394,000

Selling spot rate, 10/15/17 39.00

Selling spot rate, 9/15/17 39.40
Increase in spot rate 0.40
Multiply: FC units 10,000
Foreign Exchange Loss 4,000

COMPANY C:

10/30/2017 Purchases 200,000

Accounts Payable 200,000

COMPANY D:

11/15/2017 Purchases (20,000 x 38.60) 772,000

Cash 772,000

Selling spot rate, 10/15/17 38.60

Selling spot rate, 9/15/17 38.60
Spot rate -
COMPANY E:

10/15/2017 Purchases (10,000 x 39.40) 770,000

Accounts Payable 770,000

Selling spot rate, 12/15/17 38.50

Selling spot rate. 11/15/17 38.60
Increase in spot rate 0.1
Multiply: FC units 20,000
Foreign Exchange Loss 2,000
COMPANY C:

10/10/2018 Purchases 200,000

Accounts Payable 200,000

COMPANY D:

10/10/2018 Selling spot rate, 10/10/18 38.30

Selling spot rate, 12/31/17 38.80
Decrease in selling spot rate 0.50
Multiply: FC units 20,000
Foreign Exchange Gain 10,000

10/10/2018 Accounts Payable 10,000

Foreign Exchange Gain 10,000
Cash – Foreign Currency (20,000 x 38.30) 766,000
Cash 766,000
Accounts Payable 766,000
Cash – Foreign Currency 766,000

COMPANY E:

10/10/2018 Selling spot rate, 10/10/18 38.30

Selling spot rate, 12/31/17 38.80
Decrease in selling spot rate 0.50
Multiply: FC units 20,000
Foreign Exchange Gain 10,000

10/10/2018 Accounts Payable 10,000

Foreign Exchange Gain 10,000
Cash – Foreign Currency (20,000 x 38.30) 766,000
Cash 766,000
Accounts Payable 766,000
Cash – Foreign Currency 766,000
 PROBLEM 2: EXPORTING TRANSACTIONS

COMPANY F:

9/15/2017 Accounts Payable 200,000

Sales 200,000

COMPANY G:

10/15/17 Accounts Receivable (10,000 x 39.40) 395,000

Sales 395,000

Buying spot rate, 12/31/17 38.50

Buying spot rate, 9/15/17 39.50
Increase in spot rate 0.1
Multiply: FC units 10,000
Foreign Exchange Loss 10,000

12/31/17 Foreign Exchange Loss 10,000

Cash 10,000

COMPANY H:

10/30/2017 Accounts Receivable 200,000

Sales 200,000

10/10/2018 Cash 200,000

Accounts Receivable 200,000

COMPANY I:

11/15/2017 Accounts Receivable (20,000 x 37.80) 756,000

Sales 756,000

Buying spot rate, 12/31/17 38.50

Buying spot rate, 11/15/17 37.80
Decrease in spot rate 0.7
Multiply: FC units 20,000
Foreign Exchange Gain 14,000

12/31/2017 Accounts Receivable 14,000

Foreign Exchange Gain 14,000

10/10/2018 Buying spot rate, 10/10/18 38.20

Buying spot rate, 12/31/17 38.50
Decrease in selling spot rate 0.30
 Multiply: FC units 20,000
Foreign Exchange Loss 6,000

10/10/2018 Foreign Exchange Gain 6,000

Accounts Receivable 6,000
Cash – Foreign Currency (20,000 x 38.20) 764,000
Cash 764,000
Cash 764,000
Cash – Foreign Currency 764,000

COMPANY J:

Buying spot rate, 10/10/18 38.20

Buying spot rate, 12/31/17 38.50
Decrease in buying spot rate 0.30
Multiply: FC units 20,000
Foreign Exchange Loss 6,000

10/10/2018 Foreign Exchange Loss 6,000

Accounts Receivable 6,000
Cash – Foreign Currency (20,000 x 38.20) 764,000
Accounts Receivable 764,000
Cash 764,000
Cash - Foreign Currency 764,000