Question

An American company Pete Inc. sold its inventory to Ping Pte. ltd for $20,000 Singapore dollars (SGD). and to satriaTbk. For 300,000,000 rupiah on December 1,2014 when the spot rate for SGD is $0.798 baht, when the spot rate for baht is $0.031. Pete closed its books on December 31,2014 and collected the total sale and settlement amount on January 15,2015. Spot rates are given as follows:

Dec 31,2014 Jan 15,2015

Singaporean Dollars $0.76 $0.802

Indonesian Rupiah $0.0000911 $0.0000805

Thai Baht $0.029 $0.0318

Required: prepare the required journal entries to account for the transaction above .

Answer 1

since the conversion rates of rupiah is not given on the day of sale it is assumed to be $ 0.0000911. the student can assume the correct rate and make changes accordingly.

On Purchase:
Ping Pte limited		Dr.	15,960.00
	to Sales			15,960.00
(Conversion rate @ 0.798)
Satria Tbk		Dr.	27,330.00
	To Sales			27,330.00
(Conversion rate 0.000091 per $)
On B/s Date:
Loss on Currency change		Dr.	760.00
	To Ping Pte Limited			760.00
On Date of Realisation;
Bank Account		Dr.	16,040.00
	To Ping Pte Ltd			15,200.00
	To Gain on realisation			840.00
Bank Account		Dr.	24,150.00
Loss on realisation		Dr.	3,180.00
	TO Satria Tbk			27,330.00