True False + MCQ: Chapter 4,5,6,7,8,9
Exercises 1: Translation Chapter 7
Exercise 2: Chapter 6
Dec 1, 2018, Topica, a U.K Company, makes a sale and ships goods to Eximco,
a U.S company.
Sales price is $20,000. Eximco agrees to pay in USD by bank transfer on Feb 1,
2019
Spot rate Case 1 Case 2 Case 3
Dec 1, 2018 $1,3 per £ $1,3 per £ $1,3 per £
Dec 31, 2018 $1,32 per £ $1,28 per £ $1,32 per £
Feb 1, 2019 $1,35 per £ $1,25 per £ $1,28 per £
Topica has a December 31 year end.
Required 1:
1. How does Topica record the sale (in £) on Dec 1, 2018?
2. How does Topica record the foreign Exchange gain/loss on Dec 31, 2018 and
on Feb 1, 2019?
Exercise 3: Chapter 6
Dec 1, 2018, Topica, a U.K Company, purchase goods from Eximco, a U.S
company.
Sales price is $20,000. Topica agrees to pay in USD by bank transfer on Feb 1,
2019
Spot rate Case 1 Case 2 Case 3
Dec 1, 2018 $1,3 per £ $1,3 per £ $1,3 per £
Dec 31, 2018 $1,32 per £ $1,28 per £ $1,32 per £
Feb 1, 2019 $1,35 per £ $1,25 per £ $1,28 per £
Topica has a December 31 year end.
Required 1:
1. How does Topica record the sale (in £) on Dec 1, 2018?
2. How does Topica record the foreign Exchange gain/loss on Dec 31, 2018 and
on Feb 1, 2019?