Question: Foreign Currency Commitment: U.S. Corporation entered into a contract on November 1, 2017 to sell two machines to International Company for 750,000 foreign currency units

Foreign Currency Commitment:

U.S. Corporation entered into a contract on November 1, 2017 to sell two machines to International Company for 750,000 foreign currency units (FCU). The machines were to be delivered and the amount collected on March 1, 2018. In order to hedge its commitment, U.S. entered, on November 1, 2017 , into a forward contract to sell 750,000 FCU on March 1, 2018. The forward contract met all conditions for hedging a foreign currency commitment. Selected exchange rates for FCU at various dates were as follows:

Date	Spot Rate	Forward Rate (Delivery on 3/1/2018)
11/1/2017	$0.9540	$0.9535
12/31/2017	$0.9452	$0.9515
3/1/2018	$0.9626

Required: Prepare all journal entries relative to the above on the following dates:

1. November 1, 2017.

2. Year-end adjustments on December 31, 2017.

3. March 1, 2018. (Include all adjustments related to the forward contract)

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