Recording International Investment To take advantage of high short-term interest rates, Chipotle Mexican Grill purchased a l ,000,000 krona six-month certificate of deposit from a Swedish bank for $124,500 on October 1, 2012. The annual interest rate is 15 percent. Chipotle received the full principal CHIPOTLE and interest, in krona, on March 31, 2013, and immediately exchanged the krona for U.S. dollars at the cur- MEXICAN GRILL rent spot rate. Spot rates ($/krona) at December 31, 2012, and March 31, 2013, were $0.1445 and $0.1228, [CMG1 respectively. Chipotle is a calendar-year company.
Required
a. Prepare the journal entries recorded by Chipotle on October 1, 2012, December 31, 2012, and March 31, 2013.
b. Was this a good investment? Explain with calculations.