On 10/17/2017, a U.S. company (which has a 12/31 year-end) took delivery from a Canadian firm of inventory costing C$500,000.

(Foreign Currency Transaction)

On 10/17/2017, a U.S. company (which has a 12/31 year-end) took delivery from a Canadian firm of inventory costing C$500,000. Payment is due in 90 days. Concurrently the company entered into a forward contract to buy C$500,000 in 90 days at 1 C$ = $1.05. Direct exchange rates for C$ on the respective dates are as follows:

Date	Spot Rate	Forward Rate (Delivery on 1/15/18)
10/17/2017	1.04	1.05
12/31/2017	1.08	1.07
1/15/2018	1.01

Required: Prepare all entries related to this transaction, assuming that the payment was made on 1/15/18.

Expert Solution

ekkarill92 answered 2 years ago

At 12/31/17, the end of Jenner Company's first year of business, inventory was $4,100 and $2,800...

At 12/31/17, the end of Jenner Company's first year of business, inventory was $4,100 and $2,800 at cost and at market, respectively. Following is data relative to the 12/31/18 inventory of Jenner: Original Appropriate Cost Selling Disposal Inventory Item Per Unit Price Cost NRV Value A $ .65 $ 1.00 B .45 1.00 C .70 1.00 D .75 1.00 E .90 1.00 Selling price is $1.00/unit for all items. Disposal costs amount to 10% of selling price and a "normal"...

Harrison Company has a July 31 fiscal year end and uses a perpetual inventory system. The...

Harrison Company has a July 31 fiscal year end and uses a perpetual inventory system. The records of Harrison Company show the following data: 2021 2020 2019 Income statement: Sales $350,000 $330,000 $310,000 Cost of goods sold 245,000 235,000 225,000 Operating expenses 76,000 76,000 76,000 Balance sheet: Merchandise inventory 55,000 45,000 35,000 After its July 31, 2021, year end, Harrison discovered two errors: 1. At July 31, 2020, Harrison had $10,000 of goods held on consignment at another company that...

Crane Company has a July 31 fiscal year end and uses a perpetual inventory system. The...

Crane Company has a July 31 fiscal year end and uses a perpetual inventory system. The records of Crane Company show the following data: 2021 2020 2019 Income statement: Sales $350,000 $325,000 $360,000 Cost of goods sold 247,000 228,000 273,000 Operating expenses 70,000 70,000 70,000 Balance sheet: Merchandise inventory 52,000 44,000 35,000 After its July 31, 2021, year end, Crane discovered two errors: 1. At July 31, 2020, Crane had $10,000 of goods held on consignment at another company that...

The Sheffield Company has just completed a physical inventory count at year end, December 31, 2022....

The Sheffield Company has just completed a physical inventory count at year end, December 31, 2022. Only the items on the shelves, in storage, and in the receiving area were counted and costed on the FIFO basis. The inventory amounted to $75,500. During the audit, the independent CPA discovered the following additional information: (a) There were goods in transit on December 31, 2022, from a supplier with terms FOB destination, costing $10,500. Because the goods had not arrived, they were...

he Monty Company has just completed a physical inventory count at year end, December 31, 2022....

he Monty Company has just completed a physical inventory count at year end, December 31, 2022. Only the items on the shelves, in storage, and in the receiving area were counted and costed on the FIFO basis. The inventory amounted to $81,600. During the audit, the independent CPA discovered the following additional information: (a) There were goods in transit on December 31, 2022, from a supplier with terms FOB destination, costing $9,800. Because the goods had not arrived, they were...

Question