Question: I need help with the problem below. Thanks in advance! Problem 1: On June 1 Hammer Company purchased inventory from a foreign supplier at a

I need help with the problem below. Thanks in advance!

I need help with the problem below. Thanks in advance! Problem 1:

Problem 1: On June 1 Hammer Company purchased inventory from a foreign supplier at a price of 75,000 FCU (FCU is "foreign currency units") Hammer will make payment in three months on September 1. On June 1, Hammer entered into a forward contract maturing on September 1 as a fair value hedge of its FCU lliability. Prepare all journal entries, including adjusting entries, to record the transaction and the forward contract. Date Spot rate Forward rate* June 1 $0.40 $0.45 June 30 $0.43 $0.44 Sept. 1 $0.46 *Forward rate is for a contract written on June 1 to mature on September 1. (Disregard the impact of any interest factor or discount rate.)

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