Suggested time 2 1 minutes Baker Limited manufactures cameras used in professional hockey leagues on the
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Suggested time minutesBaker Limited manufactures cameras used in professional hockey leagues on the ice including in the back of the net to get a glimpse of those flying pucks. Baker Limited not only sells these cameras all over the world, but a temporary shortage in Canada of the chips used in production of the camera resulted in some inventory of these chips being purchased outside of Canada. Baker Limited has a December styearend and follows IFRS.There are two transactions that the accountant of Baker Limited requires your assistance in recording correctly.Required:Prepare the journal entries that Baker Limited should make in and to record thetwo eventsdescribed below. Entries are also required for any adjustments necessary at yearend. Please round to the nearest dollar and show your workings Transaction One marksOn December Baker Limited purchased an order of computer chips from a supplier in the US The inventory was delivered to Baker Limited on December and the invoice allowed sixty days for the payment to be made. The invoice was for $ US Baker Limited did not hedge this transaction. Baker Limited paid the invoice on January Spot rates were as follows:December $CDN $ USDecember $CDN $ USJanuary $CDN $USTransaction Two marksOn October Baker Limited lent money to a hockey team in the German Elite League who found themselves in a cash flow crunch while they awaited the cash payment from a trade done to a team in France. Baker Limited lent the team Euros. The note receivable was due in months and was noninterest bearing. Baker Limited went to the bank on October and wired the Euros through the bank.The exchange rate at October was Euro $ CDN and the rate at December was Euro $ CDNYOU ARE NOT REQUIRED TO DO THE JOURNAL ENTRY FOR
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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