On October 1, 2028, Philly Company purchased inventory from a German supplier for 80,000 Euros due...
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• On October 1, 2028, Philly Company purchased inventory from a German supplier for 80,000 Euros due on January 31, 2029. • Simultaneously, Philly entered into a forward contract for 80,000 Euros for delivery on January 31, 2029. Payment was made to the foreign supplier on 1/31/2029. • Spot rates on October 1, December 31, and January 31, were $1.32, $1.21, and $1.45, respectively. • Forward rates on October 1 and December 31 were $1.39 and $1.33 respectively. Required: Prepare all journal entries related to the above transactions on October 1, 2028, December 31, 2018, and January 31, 2029. • On October 1, 2028, Philly Company purchased inventory from a German supplier for 80,000 Euros due on January 31, 2029. • Simultaneously, Philly entered into a forward contract for 80,000 Euros for delivery on January 31, 2029. Payment was made to the foreign supplier on 1/31/2029. • Spot rates on October 1, December 31, and January 31, were $1.32, $1.21, and $1.45, respectively. • Forward rates on October 1 and December 31 were $1.39 and $1.33 respectively. Required: Prepare all journal entries related to the above transactions on October 1, 2028, December 31, 2018, and January 31, 2029.
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Answer A HEDGE ITEM HEDGING INSTRUMENT 10128 Dr Inventory 80000X132 105600 Dr Forward Contract Receivable80000x139 111200 Cr Accounts Payable 105600 Cr Forward Contract Payable 111200 123128 Dr Accoun... View the full answer
Related Book For
Advanced Financial Accounting
ISBN: 978-0137030385
6th edition
Authors: Thomas Beechy, Umashanker Trivedi, Kenneth MacAulay
Posted Date:
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