On February 1, 2021, Amal LLC., an Emarti company, made a sale and shipped goods to Jan
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Question:
On February 1, 2021, Amal LLC., an Emarti company, made a sale and shipped goods to Jan Inc, a Danish customer, for100,000 AED, It is agreed that Jan Inc will pay the total amount in Danish Krone on May 1, 2021.
• The exchange (spot) rate as of February 1, 2021, was 2 Krone for 1 Dirham.
• The exchange (spot) rate as of May 1, 2021, was 2.5 Krone for 1 Dirham.
Required:
1. Journalize February's and May's transactions for Amal LLC.,
2. Advise Amal LLC., how loss on foreign exchange can be avoided.
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