Eximco Corporation (based in Champaign, Illinois) has a number of transactions with companies in the country of
Question:
Eximco properly designates its forward contract as a fair value hedge of a foreign currency receivable.
The following rates for the mong apply:
Eximcos incremental borrowing rate is 12 percent. The present value factor for one month at an annual interest rate of 12 percent (1 percent per month) is 0.9901.
a. Prepare all journal entries, including December 31 adjusting entries, to record these transactions and the forward contract.
b. What is the impact on net income in 2011?
c. What is the impact on net income in2012?
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Related Book For
Advanced Accounting
ISBN: 978-0077431808
10th edition
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik
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