Question
In: Accounting
An American company sells merchandise on account to a Swiss company for CHF 50,000 on 1/12/2019...
An American company sells merchandise on account to a Swiss company for CHF 50,000 on 1/12/2019 when the rate was 1 CHF = 0.9 USD. On 31/12/2019 the rate was 1 CHF = 0.96 USD. On 25/1/2020 the Swiss company pays its obligation to the US company (the rate was 1 CHF = 1.01 USD), which keeps the foreign cash it and converts the amount to US dollars on 10/2/2020, when the rate was 1 CHF = 0.99 USD. Required: Provide the journal entries on each of the above mentioned dates (Note: CHF means Swiss franc). NOTE: IF YOU CANNOT CLEARLY WRITE THE JOURNAL ENTRIES LIKE YOU WOULD ON A PAPER EXAM, PLEASE MENTION dr OR cr NEAR EACH ACCOUNT IN THE JOURNAL ENTRY AS APPROPRIATE.
Solutions
Expert Solution
when cash is received from Customer their account ledger(Accounts receivable-Swiss) Should be closed as their liability ends on that date itself and So their ledger should not be used again while depositing the same on different date.
Foreign exchange loss is because of the difference between check received and deposited dates
($1.01-0.99=$0.02) 50000 CHF*$0.02= $1000
So amount finally realised is $ 0.99 Per CHF So 50000 CHF *$0.99=$49500
ekkarill92 answered 2 years agoRelated Solutions
An American company sells merchandise on account to a Swiss company for CHF 50,000 on 1/12/2019...
An American company sells merchandise on account to a Swiss
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MAY 1 .
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The two methods to estimate uncollectible accounts
are-------------------------------------
and---------------------------------------------------------------
Accounts Receivable minus Allowance for Doubtful
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------------------------------------------------------------------
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1
Sold a high-definition television set on credit to Candy Cho;
issued Sales Slip 101 for $3,000 plus sales tax of $210.
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DATE
TRANSACTIONS
2019
Sept.
1
Sold a high-definition
television set on credit to Candy Cho; issued Sales Slip 101 for
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Sold stereo equipment on credit
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Exceptional Electronics began operations September 1, 2019. The firm sells its merchandise for cash and on...
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DATE
TRANSACTIONS
2019
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Sold a high-definition
television set on credit to Candy Cho; issued Sales Slip 101 for
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Sold stereo equipment on credit
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DATE
TRANSACTIONS
2019
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1
Sold merchandise on credit to
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4
Sold merchandise on credit to
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