On December 15, 2001, Star glass Co. entered into a 30-day forward contract to buy 10,000 yens at the forward rate of 1.50. 0n December 31, 2001, the forward rate was 1.25 and January 15,2002, the spot rate moved to 1.60. Provide the journal entries under each of the following scenarios:

(a) The contract is settled by the actual purchase of yens; and

(b) The contract is settled through net cash payment.

Answer rating: 100% (QA)

Future contract must be accounted for now when it is signed and again on the date when the ... View the full answer