Emu Ltd is an Australian company that receives management consulting services from a US company called Holleewood Incorporated. On 15 June 2023, Emu Ltd received an invoice from Holleewood Incorporated amounting to US$7 million for services provided over the period 1 January 2023 to 31 May 2023. On 15 July 2023, Emu Ltd paid the invoice. The functional currency of Emu Ltd is A$ and its financial year ends on 30 June. Applicable exchange rates are as follows. 1 January A$1=US$0.72 A$1=US$0.66 31 May 2023 Average 1 Jan. 2023 to 31 May 2023 A$1=US$0.67 15 June 2023 A$1=US$0.59 30 June 2023 A$1=US$0.57
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- co de Y- D E F G H 1 K 18. Platypus Ltd exports goods to Harlom Inc. All sales contracts are denominated in US dollars. Sales of US$5 million are made on 1 May 2022, FOB Sydney. The amount is due for payment by Harlom Inc. on 1 September 2022. Platypus Ltd's reporting date is 30 June. Additional information Date Spot rate 1 May 2022 A$1.00 US$0.84 30 June 2022 A$1.00 US$0.85 1 September 2022 A$1.00 = US$0.86 REQUIRED Prepare the journal entries for Platypus Ltd to account for the above transaction. LO 30.2, 30.3, 30.5 Sheet1On 1 July 2019 Celine Consultants Ltd completes a contract to provide advice on the installation of a networked computer system to a company in the US. The client pays the fee of US$700 000 into Celine Consultants’ US bank account on that date. The bank pays interest of 5 per cent annually on 30 June. The exchange rate information is: 1 July 2019 $A1 = US$0.59 30 June 2020 $A1 = US$0.67 What journal entries are required in Celine Consultants Ltd’s books for 1 July 2019 and 30 June 2020Problem 1: On November 1, 2020, an entity acquired on account goods from foreign supplier at a cost of 1,000 USD. The accounts payable are paid on January 30, 2021. On December 1, 2020, an entity sold on account the said goods to a foreign customer at a selling price of 1,500 USD. The accounts receivable is collected on February 28, 2021. The entity is operating in Philippine economy wherein the functional currency is the Philippine Peso. The following direct exchange rates are provided: 12/1/20 12/21/20 1/30/21 11/1/20 2/28/21 Buy Sell 40 39 45 43 42 42 40 47 46 45 What is the sales revenue to be reported by the entity for the year ended December 31, 2020? b. What is the cost of sales to be reported by the entity for the year ended December 31, 2020? What is the book value of accounts receivable on December 31, 2020? d. What is the book value of accounts payable on December 31, 2020? What is the net foreign currency gain or loss for the year ended December 31, 2020? а. С. е.
- Accounting - The spot rate was US$1 = C$1.02, on August 1, 2019, Andy Corporation in Canada ordered equipment from an American supplier for US$260,000. Delivery was scheduled for the month of September, with payment in full on delivery. Upon placing the order, Andy immediately entered into a forward contract with its bank to purchase US$260,000 on September 15, 2019 at the forward rate of US$ = C$1.01. The equipment was received on September 15, 2019, when the spot rate was US$ = C$0.99. For accounting purposes, what type of hedge is the forward contract? a. A cash flow hedge b. A currency hedge C. A fair value hedge d. A self-sustaining hedge8. Assume that your company purchases inventories from a supplier on December 15. The invoice specifies that payment is to be made on March 15 in Euros in the amount of 10,000 Euros. Your company operates on a calendar year basis. Assume the following exchange rates and the company does not enter into any hedging arrangements: December 15 $1.35 :1 Euro December 31 $1.37 :1 Euro March 15 $1.38 :1 Euro Requirement: Prepare the journal entry that needs to be made on March 15Accounting for Business Combinations Honesty Company placed a purchase order to a Singaporean Company on October 9, 2022. The contract price was S$150,000. The merchandise was delivered on November 19, 2022. The invoice was dated November 15, 2022, FOB Destination. Full payment was paid on January 15, 2023. The spot rate for the Singaporean Dollar on the respective dates is as follows (see image below). Answer the following subquestions: a. How much is the Purchases to be reported in 2022? b. How much is Foreign Exchange Gain (Loss) to be reported in 2022? ________________ thanks!
- n 1 March 2020 Holmes Ltd enters into a binding agreement with a New Zealand company, whichrequires the New Zealand Company to construct an item of machinery for Holmes Ltd. The cost of themachinery is NZ$750,000. The machinery is completed on 1 June 2021 and shipped FOB Auckland onthat date. The debt is unpaid at 30 June 2020, which is also Holmes Ltd’s reporting date.The exchange rates at the relevant dates are:1 March 2011 A$1.00 = NZ$1.201 June 2011 A$1.00 = NZ$1.3030 June 2011 A$1.00 = NZ$1.25Required:a) Determine the amount in AUD, as at:• 1 March 2020; and• 30 June 2020. b) Prepare the journal entries for the above dates showing the amount of exchange gain or loss (Max Ltd sells equipment to Star Ltd, a U.S. company on 30/01/2020 for US$250,000. Goods are invoiced in US dollars. Payment is made on 5/03/2020. The company also buys parts from the USA, also invoiced in US$, value US$187,500 on 20/4/2020. The functional currency of Max Ltd is AUD$. As at 30/06/2020, this debt unpaid. Rates: 30/01 – A$1 = US$0.93 5/03 – A$1 = US$0.92 20/4 – A$1 = US$0.94 30/6 – A$1 = US$0.91 Required: SHOW YOUR WORKINGS Prepare journal entries for the above transactions. (Round answers to the nearest dollar, e.g. $200,263.57 = $200,264).Question: What is the impact on 2020 net income? Icebreaker Company (a U.S.-based company) purchases materials from a foreign supplier on December 1, 2020, with payment of 14,000 dinars to be made on March 1, 2021. The materials are consumed immediately and recognized as cost of goods sold at the date of purchase. On December 1, 2020, Icebreaker enters into a forward contract to purchase 14,000 dinars on March 1, 2021. Relevant exchange rates for the dinar on various dates are as follows: Date Spot Rate Forward Rate(to March 1, 2021) December 1, 2020 $ 3.20 $ 3.275 December 31, 2020 3.30 3.400 March 1, 2021 3.45 N/A Assuming that Icebreaker designates the forward contract as a cash flow hedge of a foreign currency payable.
- Rolfe Company (a U.S.-based company) has a subsidiary in Nigeria where the local currency unit is the naira (NGN). On December 31, 2019, the subsidiary had the following balance sheet (amounts are in thousands [000s): Cash Inventory Land Building Accumulated depreciation 2011 2013 August 1, 2019 December 31, 2019 February 1, 2020 May 1, 2020 June 1, 2020 August 1, 2020 September 1, 2020 NGN 16,790 Notes payable Common stock Retained. 11,900 earnings The subsidiary acquired the inventory on August 1, 2019, and the land and building in 2013. It issued the common stock in 2011. During 2020, the following transactions took place: October 1, 2020 November 1, 2020 December 1, 2020 December 31, 2020 Average for 2020 4,190 41,900 (20,950) NGN 53,830 2020 Feb. 1 Paid 8,190,000 NGN on the note payable. May 1 Sold entire inventory for 17,900,000 NGN on account. June 1 Sold land for 6,190,000 NGN cash. Aug. 1 Collected all accounts receivable. Sept. 1 Signed long-term note to receive 8,190,000 NGN…On 1 March 2020 Holmes Ltd enters into a binding agreement with a New Zealand company, whichrequires the New Zealand Company to construct an item of machinery for Holmes Ltd. The cost of themachinery is NZ$750,000. The machinery is completed on 1 June 2021 and shipped FOB Auckland onthat date. The debt is unpaid at 30 June 2020, which is also Holmes Ltd’s reporting date.The exchange rates at the relevant dates are:1 March 2011 A$1.00 = NZ$1.201 June 2011 A$1.00 = NZ$1.3030 June 2011 A$1.00 = NZ$1.25Required: Prepare the journal entries for the above dates showing the amount of exchange gain or lossProblem 2: Old Colonial Corp. (a U.S. company) made a sale to a foreign customer on September 15, 2018, for 100,000 stickles. Payment was received on October 15, 2018. The following exchange rates applied: Date Rate Date Rate Date Rate Sept. 15, 2018 51-5.48 Sept 30, 2018 51-5.50 Oct. 15, 2018 51-5.44 Required: Prepare all journal entries for Old Colonial Corp. in connection with this sale assuming that the company closes its books on September 30 to prepare interim financial statements.