Borrow Overseas Corp. (BOC) is a Canadian company that reports its financial results in Canadian dollars in accordance with IFRS. On December 31, 20X5, BOC’s year-end, the company borrowed €1,000,000. This two-year loan is repayable in full on December 31, 20X7. Interest is payable annually at 6% with the first interest payment due on December 31, 20X6. Pertinent exchange rate information follows: Date	Exchange rate
December 31, 20X5	€1.00 = C$1.4267
December 31, 20X6	€1.00 = C$1.4345
December 31, 20X7	€1.00 = C$1.4129
Average rate for December 20X6	€1.00 = C$1.4322
Average rate for December 20X7	€1.00 = C$1.4143
Average rate for 20X6	€1.00 = C$1.4306
Average rate for 20X7	€1.00 = C$1.4188

Required:

Prepare separate journal entries to reflect all events during the lifetime of the loan that impacts BOC’s year-end financial statements. Support the journal entries with a brief explanation as to their nature. Include supporting calculations in the journal entries or reference their location elsewhere on the worksheet.

Answer rating: 100% (QA)

Answer Date Dec 31 20X5 Dec 31 20X6 Dec 31 20X6 Dec 31 20X7 Dec 31 20X7 D... View the full answer