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Please find below solution for both parts A and B:
Part A
Amount | |
Accounts Receivable | |
SLS, Inc. (denominated in $) | $190,000 |
TNT, Ltd. (140,000 x $1.482) | $207480 |
Accounts Payable | |
AGT (590,000 x $.460) | $271400 |
SDS, Ltd. (denominated in $) | $140,000 |
Part B
Receivable | Payable | |||
SLS, Inc. | TNT, Ltd. | AGT | SDS, Ltd. | |
Transaction date | $190,000 | $210,840* | $289,100** | $140,000 |
Balance sheet date | 1,90,000 | 207,480*** | 271,400**** | 1,40,000 |
Transaction gain (loss) | $ 0 | $ (3,360) | $ 17,700 | $ 0 |
Workings:
* 140,000 x $1.506 = $210,840
** 590,000 x $0.490 = $289,100
*** 140,000 x $1.482 = $207,480
**** 590,000 x $.460 = $271,400
Note:
Exercise 12-6 Agentel Corporation is a U.S.-based importing-exporting company. The company entered into the following transactions...
Exercise 12-6
Agentel Corporation is a U.S.-based importing-exporting company.
The company entered into the following transactions during the
month of November.
Nov.
6
Purchased merchandise from AGT, a Swiss firm, for 590,000
francs.
5
Sold merchandise to SLS, Inc., a firm located in Rio De
Janeiro, for $190,000.
18
Sold merchandise to TNT, Ltd., a British firm, for 140,000
pounds.
20
Purchased merchandise from SDS, Ltd., a British firm, for
$140,000.
All the transactions were unsettled at December 31, Agentel’s...
P13-11 Importing and Exporting Transactions; Hedges of Exposed Foreign Currency Asset and Lia- bility Positions; Identifiable Foreign Currency Commitment; Speculative Forward Exchange Contract; Intervening Balance Sheet Date Reynolds Corporation has extensive dealings with foreign suppliers and buyers. During the first six months of the fiscal year 19X5, Reynolds reported the following foreign transactions, all of which are denominated in the local currency of the respec- tive foreign firm. Reynolds prepares financial statements on June 30 and December 31 of each...