1. On May 1, Harris purchased parts from a Japanese company for a U.S. dollar-equivalent value of $8,400 to be paid on June 20. The exchange rates were May 1 June 20 1 yen = $0.0070 1 yen = 0.0075 2. On July 1, Harris sold products to a Brazilian customer for a U.S. dollar equivalent of $10,000, to be received on August 10. Brazil's local currency unit is the real. The exchange rates were July 1 August 10 1 real = $0.20 1 real = 0.22 Required: a. Assume that the two transactions are denominated in U.S. dollars. Prepare the entries required for the dates of the transactions and their settlement in U.S. dollars. b. Assume that the two transactions are denominated in the applicable LCUs of the foreign entities. Prepare the entries required for the dates of the transactions and their settlement in the LCUs of the Japanese company (yen) and the Brazilian customer (real).

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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1. On May 1, Harris purchased parts from a Japanese company for a U.S. dollar-equivalent value of $8,400 to be paid on June 20. The
exchange rates were
May 1
June 20
2. On July 1, Harris sold products to a Brazilian customer for a U.S. dollar equivalent of $10,000, to be received on August 10. Brazil's
local currency unit is the real. The exchange rates were
July 1
August 10
Required:
a. Assume that the two transactions are denominated in U.S. dollars. Prepare the entries required for the dates of the transactions and
their settlement in U.S. dollars.
b. Assume that the two transactions are denominated in the applicable LCUs of the foreign entities. Prepare the entries required for
the dates of the transactions and their settlement in the LCUs of the Japanese company (yen) and the Brazilian customer (real).
Answer is not complete.
Complete this question by entering your answers in the tabs below.
No
Required A
Required B
Assume that the two transactions are denominated in the applicable LOUs of the foreign entities. Prepare the entries required
for the dates of the transactions and their settlement in the LCUs of the Japanese company (yen) and the Brazilian customer
(real).
1
2
4
5
1 yen $0.0070
1 yen = 0.0075
6
Date
May 01
June 20
1 real = $0.20
1 real = 0.22
June 20
July 01
August 10
Inventory (or Purchases)
Accounts payable ()
General Journal
Foreign currency transaction loss
Accounts payable (+)
Accounts receivable (BRL)
Sales
Accounts receivable (BRL)
Cash
Cash
Accounts receivable (BRL)
33
33
XX
››
XX
Debit
8,400✔
8,400 X
Credit
8,400
10,000 X
Transcribed Image Text:1. On May 1, Harris purchased parts from a Japanese company for a U.S. dollar-equivalent value of $8,400 to be paid on June 20. The exchange rates were May 1 June 20 2. On July 1, Harris sold products to a Brazilian customer for a U.S. dollar equivalent of $10,000, to be received on August 10. Brazil's local currency unit is the real. The exchange rates were July 1 August 10 Required: a. Assume that the two transactions are denominated in U.S. dollars. Prepare the entries required for the dates of the transactions and their settlement in U.S. dollars. b. Assume that the two transactions are denominated in the applicable LCUs of the foreign entities. Prepare the entries required for the dates of the transactions and their settlement in the LCUs of the Japanese company (yen) and the Brazilian customer (real). Answer is not complete. Complete this question by entering your answers in the tabs below. No Required A Required B Assume that the two transactions are denominated in the applicable LOUs of the foreign entities. Prepare the entries required for the dates of the transactions and their settlement in the LCUs of the Japanese company (yen) and the Brazilian customer (real). 1 2 4 5 1 yen $0.0070 1 yen = 0.0075 6 Date May 01 June 20 1 real = $0.20 1 real = 0.22 June 20 July 01 August 10 Inventory (or Purchases) Accounts payable () General Journal Foreign currency transaction loss Accounts payable (+) Accounts receivable (BRL) Sales Accounts receivable (BRL) Cash Cash Accounts receivable (BRL) 33 33 XX ›› XX Debit 8,400✔ 8,400 X Credit 8,400 10,000 X
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