Can someone help me to solvequestions, Thank you.
1/ On 1 March 2017 Cron Ltd entered a transaction with the American Eagles Inc (a United States firm) for the sale USD500,000 of scrummaging machines. The equipment is to be air freighted on 2 May 2017 and payment is due on 1 August 2017.
Cron Ltd is concerned about exchange rate fluctuations and on 1 March purchases an option to sell USD500,000 at an exchange rate 0.7500 for delivery on 1 August 2017. Cron Ltd pays $15,500 for the option at this time. On 2 May 2017 the option is worth $1,500 and on 30 June 2017 the value of the option is $20,500.
The exchange rates over this period are:
1 March 2017
AUD1.00 = USD0.7600
2 May 2017
AUD1.00 = USD0.7400
30 June 2017
AUD1.00 = USD0.7700
1 August 2017
AUD1.00 = USD0.8000
How to prepare journal entries for Cron Ltd that are required by AASB 121 Foreign Currencies and AASB 132 / 139 Financial Instruments to record the above transactions, including the adjustments at year end (30 June 2017). Cron Ltd does not designate the option as a hedge.
Recently Asked Questions
- 2. (10 points) A flight has 61 seats left. The full-fare tickets are priced at $800 and the discount tickets are priced at $300. The airline estimates that the
- Please refer to the attachment to answer this question. This question was created from Homework 3.
- Delph Company uses a job-order costing system and has two manufacturing departments—Molding and Fabrication. The company provided the following estimates at