Question

A U.S. company, sells items abroad. Daisy prices many of these transactions in the currency of the customer. Following are four such transactions made in the last accounting period, plus the direct exchange rates for each date:

Country	Amount	Currency	Spot Rate at Sale	Spot Rate at Collection
Argentina	250,000	Peso	$0.118	$0.121
Canada	400,000	Dollar	0.932	0.954
India	300,000	Rupee	0.016	0.013
South Africa	100,00	Rand	0.091	0.087

Prepare the journal entries made by Daisy Brands to record the above sale and collection transactions.

Answer 1

Journal Entries :-

Date	Particulars	Debit($)	Credit($)
Argentina:-
	Accounts Receivable A/c Dr.	29500
	To Sales Revenue A/c (250000*$0.118)		29500
	Cash A/c Dr. (250000*$0.121)	30250
	To Accounts Receivable A/c		29500
	To Foreign Exchange Gain A/c		750
Canada:-
	Accounts Receivable A/c Dr.	372800
	To Sales Revenue A/c (400000*$0.932)		372800
	Cash A/c Dr. (400000*$0.954)	381600
	To Accounts Receivable A/c		372800
	To Foreign Exchange Gain A/c		8800
India :-
	Accounts Receivable A/c Dr.	4800
	To Sales Revenue A/c (300000*$0.016)		4800
	Cash A/c Dr. (300000*$0.013)	3900
	Foreign Exchange Loss A/c Dr.	900
	To Accounts Receivable A/c		4800
South Africa :-
	Accounts Receivable A/c Dr.	9100
	To Sales Revenue A/c (100000*$0.091)		9100
	Cash A/c Dr. (100000*$0.087)	8700
	Foreign Exchange Loss A/c Dr.	400
	To Accounts Receivable		9100