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In: Accounting
Translation of purchase of inventories on credit terms Stranded Ltd is an Australian company that purchases...
Translation of purchase of inventories on credit terms
Stranded Ltd is an Australian company that purchases inventories from Hammers plc,
which is an English company. The following information is relevant to a recent
acquisition of inventories for £300 000 pursuant to a contract with terms including FOB
shipping.
|
Date |
Event |
Exchange rate |
||
|
11 May 2017 |
Inventories shipped |
A$1 = £0.41 |
||
|
22 June 2017 |
Inventories delivered |
A$1 = £0.42 |
||
|
30 June 2017 |
End of reporting period |
A$1 = £0.43 |
||
|
31 July 2017 |
Cash payment of £300 000 to Hammers plc |
A$1 = £0.39 |
Required
In accordance with AASB 121/IAS 21, prepare all of the entries of Stranded Ltd that relate to the foreign currency purchase of inventories. How would your answer change if the inventories acquired had a net realisable value of £270 000 at 30 June 2017?
Solutions
ekkarill92 answered 2 years agoRelated Solutions
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