Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN: 9781337115773
Author: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 13, Problem 33BEB
1.
To determine
Compute the amount of liability on 1st March.
2.
To determine
Compute the amount receivable on 1st June.
3.
To determine
Compute gain or loss in case amount is received on 1st June.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
GreenView Company's receivable from a foreign customer is denominated in the customers
local currency, the Brazilian Real (BRL). This receivable totaled 900,000 BRL and was
translated to $300,000 at December 31, 20X5. On January 31, 20X6, the receivable was
collected from the customer at an exchange rate of 4 BRL to $1. What journal entry should
GreenView record in January?
Dr. Foreign currency units 300,000
Cr. Accounts receivable
Dr. Foreign currency units 225,000
2. Cr. Accounts receivable
01.
03.
4.
Dr. Foreign currency units 300,000
Cr. Exchange gain
Cr. Accounts receivable
Dr. Foreign currency units
Dr. Exchange loss
Cr. Accounts receivable
225,000
75,000
300,000
225,000
75,000
225,000
300,000
On March 1, Forward Import-Export Company purchased merchandise costing 70,100 Mexican pesos. Payment was due, in pesos, on June 1. The exchange rates of pesos for $1 were as follows:
March 1 $1 = 10.9 pesos
June 1 $1 = 11.4 pesos
Round all answers to the nearest dollar.
Required:
1. What is the liability in dollars on March 1?
2. What is the liability in dollars on June 1?
3. If Forward pays on June 1, is there an exchange gain or loss? If so, how much is it?
Leigh of New York sells its products to customers in the United States and the United Kingdom. On December 16, 2019, Leigh sold merchandise on credit to Bronson Ltd. of London at a price of 17,000 pounds. The exchange rate on that day for £1 was $1.4583. On December 31, 2019, when Leigh prepared its financial statements, the rate was £1 for $1.4382. Bronson paid its bill in full on January 15, 2020, at which time the exchange rate was £1 for $1.4482. Leigh immediately exchanged the 17,000 pounds for U.S. dollars. Prepare Leigh’s journal entries on December 16, December 31, and January 15 (round to the nearest dollar).
Chapter 13 Solutions
Managerial Accounting: The Cornerstone of Business Decision-Making
Ch. 13 - Prob. 1DQCh. 13 - Prob. 2DQCh. 13 - Why should the incremental cost of a risk response...Ch. 13 - Prob. 4DQCh. 13 - Explain how performance measurement can help...Ch. 13 - Identify and discuss the four kinds of quality...Ch. 13 - Discuss the benefits of quality cost reports that...Ch. 13 - Prob. 8DQCh. 13 - Prob. 9DQCh. 13 - When will the average unit cost be used for value...
Ch. 13 - How do international issues affect the role of the...Ch. 13 - What it a foreign trade zone, and what advantages...Ch. 13 - Prob. 13DQCh. 13 - Prob. 14DQCh. 13 - Prob. 15DQCh. 13 - A fire insurance policy on a manufacturing plant...Ch. 13 - Prob. 2MCQCh. 13 - Prob. 3MCQCh. 13 - Which of the following risk response items would...Ch. 13 - Beginning with strategy, which of the following...Ch. 13 - In which areas of an organizations value chain can...Ch. 13 - Prob. 7MCQCh. 13 - Which of the following items (correctly describes...Ch. 13 - Which of the following is a prevention cost? a....Ch. 13 - Prob. 10MCQCh. 13 - Prob. 11MCQCh. 13 - Prob. 12MCQCh. 13 - Prob. 13MCQCh. 13 - A manufacturing cell within a value stream has...Ch. 13 - Prob. 15MCQCh. 13 - Prob. 16MCQCh. 13 - Prob. 17MCQCh. 13 - Prob. 18MCQCh. 13 - Prob. 19MCQCh. 13 - Prob. 20BEACh. 13 - Quality Cost Report Whitley Company had total...Ch. 13 - Andresen Company had the following quality costs...Ch. 13 - Norris Company implemented a quality improvement...Ch. 13 - Mabbut Company has the following departmental...Ch. 13 - During the week of May 10, Hyrum Manufacturing...Ch. 13 - Prob. 26BEACh. 13 - Prob. 27BEBCh. 13 - Quality Cost Report Loring Company had total sales...Ch. 13 - Cassara, Inc., had the following quality costs for...Ch. 13 - Pintura Company implemented a quality improvement...Ch. 13 - Gumbrecht Company has the following departmental...Ch. 13 - During the week of August 21, Parley Manufacturing...Ch. 13 - Prob. 33BEBCh. 13 - Prob. 34ECh. 13 - Prob. 35ECh. 13 - Crazy Fan Guard Company provides security services...Ch. 13 - Jacks Apps Company researches, develops, and sells...Ch. 13 - Prob. 38ECh. 13 - Prob. 39ECh. 13 - Classify the following quality costs as prevention...Ch. 13 - Bradshaw Company reported sales of 5,000,000 in...Ch. 13 - The controller of Emery, Inc. has computed quality...Ch. 13 - Erba Inc. has the following departmental layout...Ch. 13 - A value stream has three activities and two...Ch. 13 - A Box Scorecard was prepared for a value stream:...Ch. 13 - Match each term in Column A with its related...Ch. 13 - Match each term in Column A with its related...Ch. 13 - Prob. 48ECh. 13 - Refer to Exercise 13-48. Suppose that Kamber is...Ch. 13 - Prob. 50ECh. 13 - Prob. 51PCh. 13 - Prob. 52PCh. 13 - Dorsey Scott MU Company manufactures and bottles a...Ch. 13 - Danna Wise, president of Tidwell Company, recently...Ch. 13 - Prob. 55PCh. 13 - In 20X1, Don Blackburn, president of Price...Ch. 13 - Brasher Company is transitioning to a lean...Ch. 13 - Merkley Company, a manufacturer of machine parts,...Ch. 13 - Paladin Company manufactures plain paper fax...Ch. 13 - Custom Shutters. Inc., manufactures plantation...Ch. 13 - Prob. 61PCh. 13 - Corporate sustainability reports vary greatly...Ch. 13 - Luna Company is a printing company and a...Ch. 13 - Lindell Manufacturing embarked on an ambitious...Ch. 13 - Paterson Company, a U.S.-based company,...
Knowledge Booster
Similar questions
- Doering Company, a U.S. corporation with customers in several foreign countries, had the following selected transactions for 2019 and 2020. 2019 Apr. 8 Sold merchandise to Salinas & Sons of Mexico for $5,938 cash. The exchange rate for pesos is $0.1043 on this day. July 21 Sold merchandise on credit to Sumito Corp. in Japan. The price of 1.5 million yen is to be paid 120 days from the date of sale. The exchange rate for yen is $0.0094 on this day. Oct. 14 Sold merchandise for 19,000 pounds to Smithers Ltd. of Great Britain, payment in full to be received in 90 days. The exchange rate for pounds is $1.4566 on this day. Nov. 18 Received Sumito’s payment in yen for its July 21 purchase and immediately exchanged the yen for dollars. The exchange rate for yen is $0.0092 on this day. Dec. 20 Sold merchandise for 17,000 ringgits to Hamid Albar of Malaysia, payment in full to be received in 30 days. On this day, the exchange rate for ringgits is $0.4501. Dec. 31 Recorded adjusting entries…arrow_forwardVoltac Corporation (a US-based company) has the following import/export transactions denominated in Mexican pesos in 2020: March 1 May 1 August 1 September 1 Bought inventory costing 124,000 pesos on credit. Sold 80 percent of the inventory for 104,000 pesos on credit. Collected 82,000 pesos from customers. Peid 72,000 pesos to suppliers. Currency exchange rates for 1 peso for 2020 are as follows: Date March 1 May 1 August 1 September 1 December 31 U.B. Dollar рег Реко $ 0.22 0.23 0.24 0.25 0.26 Assume that all receipts were converted into dollars as soon as they were received. For each of the following accounts, what amount will Voltac report on its 2020 financial statements? Inventory b Cost of goods sold c Sales d Accounts receivable e Accounts payable Casharrow_forwardVoltac Corporation (a U.S.-based company) has the following import/export transactions denominated in Mexican pesos in 2020: Bought inventory costing 116,000 pesos on credit. March 1 May 1 August 1 September 1 Sold 60 percent of the inventory for 96,000 pesos on credit. Collected 78,000 pesos from customers. Paid 68,000 pesos to suppliers. Currency exchange rates for 1 peso for 2020 are as follows: Date March 1 May 1 August 1 September 1 December 31 Assume that all receipts were converted into dollars as soon as they were received. For each of the following accounts, what amount will Voltac report on its 2020 financial statements? a b C d Inventory Cost of goods sold Sales Accounts receivable U.S. Dollar per Peso $ 0.25 0.26 0.27 0.28 0.29 e Accounts payable f Casharrow_forward
- Voltac Corporation (a U.S.-based company) has the following import/export transactions denominated in Mexican pesos in 2020: March 1 Bought inventory costing 113,000 pesos on credit. May 1 August 1 Sold 60 percent of the inventory for 93,000 pesos on credit. Collected 76,500 pesos from customers. September 1 Paid 66,500 pesos to suppliers. Currency exchange rates for 1 peso for 2020 are as follows: Date March 1 May 1 August 1 September 1 December 31 с Assume that all receipts were converted into dollars as soon as they were received. For each of the following accounts, what amount will Voltac report on its 2020 financial statements? a b d Inventory Cost of goods sold Sales U.S. Dollar per Peso $ 0.22 0.23 0.24 0.25 0.26 Accounts receivable e Accounts payable f Casharrow_forwardAccounting records of Company C are expressed in EUR. On 30 April 20XX, it sells goods to a foreign company that requests the amount of the sale to be expressed in USD. No VAT to be charged. When the invoice is sent to the client for an amount of USD 1.000, the exchange rate EUR / USD is 1. On 31 May 20XX, the client paid the invoice in USD on the EUR bank account so that the amount in USD is immediately converted into EUR at the current exchange rate. The current exchange rate is 1EUR = 1,10 USD. Prepare the accounting journal entries for the sale and the repayment.arrow_forwardOn March 1, 2019, a U.S. company made a credit sale requiring payment in 30 days from a Malaysian company, Hamac Sdn. Bhd., of 20,000 Malaysian ringgits. Assuming the exchange rate between Malaysian ringgits and U.S. dollars is $0.4538 on March 1 and $0.4899 on March 31, prepare the entries to record the sale on March 1 and the cash receipt on March 31.arrow_forward
- Voltac Corporation (a U.S.-based company) has the following import/export transactions denominated in Mexican pesos in 2020: Bought inventory costing 100,000 pesos on credit. March 1 May 1 August 1 September 1 Sold 60 percent of the inventory for 80,000 pesos on credit. Collected 70,000 pesos from customers. Paid 60,000 pesos to suppliers. Currency exchange rates for 1 peso for 2020 are as follows: Date March 1 May 1 August 1 September 1 December 31 Assume that all receipts were converted into dollars as soon as they were received. For each of the following accounts, what amount will Voltac report on its 2020 financial statements? Inventory Cost of goods sold с Sales d Accounts receivable e Accounts payable Cash U.S. Dollar per Peso $ 0.10 0.12 0.13 0.14 0.15 a barrow_forwardSTARLA Company sold merchandise for 30,000 pounds to a customer in London on December 1, 2020. Payment inBritish pounds was due on March 31, 2021. On the same date, the company entered into a 120-day forward contract tosell 30,000 pounds to Central City Bank. Exchange rates for one pound on different dates are as follows: December 1 December 31 March 31Spot rates 81.4 82.3 82.030-day forward 82.3 82.9 83.260-day forward 82.8 82.7 82.690-day forward 81.6 82.6 83.4 120-day forward 82.5 82.8 82.5How much…arrow_forwardVoltac Corporation (a U.S.-based company) has the following import/export transactions denominated in Mexican pesos in 2020: March 1 Bought inventory costing 119,000 pesos on credit. May 1 Sold 60 percent of the inventory for 99,000 pesos on credit. August 1 Collected 79,500 pesos from customers. September 1 Paid 69,500 pesos to suppliers. Currency exchange rates for 1 peso for 2020 are as follows: Date U.S. Dollar per Peso March 1 $ 0.17 May 1 0.18 August 1 0.19 September 1 0.20 December 31 0.21 Assume that all receipts were converted into dollars as soon as they were received. Voltac will report each of the following accounts on its 2020 financial statements. Inventory $8,092 Cost of goods sold $12,138 Sales $17,820 Accounts receivable $4,095 Accounts payable $10,395 Cash $1,205 What are the corresponding journal entries?arrow_forward
- Clark Stone purchases raw material from its foreign supplier, Rinne Clay, on May 8. Payment of 1,500,000 foreign currency units (FC) is due in 30 days. May 31 is Clark's fiscal year-end. The pertinent exchange rates were as follows: Маy 8 Мay 31 Spot rate: $1.16 Spot rate: $1.18 Spot rate: $1.12 June 7 For what amount should Clark's Accounts Payable be credited on May 8? Multiple Choice $1,770,000. $1,680,000. $1,740,000. $1,850,000. $1,500,000.arrow_forwardOn December 1, Year 1, El Primero Company purchases inventory from a foreign supplier for 40,000 coronas. Payment will be made in 90 days after El Primero has sold this merchandise. Sales are made rather quickly, and El Primero pays this entire obligation on February 15, Year 2. The following exchange rates for 1 corona apply: Date U.S Dollar per Corona December 1, Year 1 $0.87 December 31, Year 1 $0.82 February 15, Year 2 $0.91 Required: Prepare all journal entries for El Primero in connection with the purchase and payment.arrow_forwardVoltac Corporation (a U.S.-based company) has the following import/export transactions denominated in Mexican pesos in 2020: March 1 Bought inventory costing 118,000 pesos on credit. May 1 Sold 80 percent of the inventory for 98,000 pesos on credit. August 1 Collected 79,000 pesos from customers. September 1 Paid 69,000 pesos to suppliers. Currency exchange rates for 1 peso for 2020 are as follows: Date U.S. Dollar per Peso March 1 $ 0.16 May 1 0.17 August 1 0.18 September 1 0.19 December 31 0.20 Assume that all receipts were converted into dollars as soon as they were received. For each of the following accounts, what amount will Voltac report on its 2020 financial statements? Voltac Corporation (a U.S.-based company) has the following import/export transactions denominated in Mexican pesos in 2020: March 1 Bought inventory costing 118,000 pesos on credit. May 1 Sold 80 percent of the inventory for 98,000 pesos on…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education