A Canadian company borrowed US$1,000,000 on July 1, 2017, with interest at 6% to be paid...

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A Canadian company borrowed US$1,000,000 on July 1, 2017, with interest at 6% to be paid on December 31 and June 30 each year of the five year term of the loan. The company prepares financial statements at each quarter-end. Exchange rates for 2017 included: July 1, 2017 September 30, 2017 December 31, 2017 US$1.00 = Can $1.30 US$1.00 = Can $1.33 US$1.00 = Can $1.36 %3D Average July to December 2017 Average July to September 2017US$1.00 = Can $1.315 Average October to December 2017 US$1.00 = Can $1.33 US$1.00 = Can $1.345 Average for 2017 US$1.00 = Can $1.31 Required: Prepare the journal entries necessary to record the loan and related interest expense and payment for 2017. A Canadian company borrowed US$1,000,000 on July 1, 2017, with interest at 6% to be paid on December 31 and June 30 each year of the five year term of the loan. The company prepares financial statements at each quarter-end. Exchange rates for 2017 included: July 1, 2017 September 30, 2017 December 31, 2017 US$1.00 = Can $1.30 US$1.00 = Can $1.33 US$1.00 = Can $1.36 %3D Average July to December 2017 Average July to September 2017US$1.00 = Can $1.315 Average October to December 2017 US$1.00 = Can $1.33 US$1.00 = Can $1.345 Average for 2017 US$1.00 = Can $1.31 Required: Prepare the journal entries necessary to record the loan and related interest expense and payment for 2017.

Answer rating: 100% (QA)

Date Particulars Debit Credit 1Jul17 Bank AC Dr 130000 To Foreign Currency Loan Ac 130000 Being Fore... View the full answer