Prepare all journal entries for Shandra Corporation related to this transaction and hedge, and answer the following questions: a. What amount should Shandra Corporation report in net income as cost of goods sold for the quarter ending June 30? b. What amount should Shandra Corporation report in net income as foreign exchange gain or loss for the quarter ending June 30?
Q: y Monkey Technologies, Incorporated purchased as a long-term investment $220 million of 8% bonds,…
A: A journal entry is a basic accounting record that is used to chronologically track financial…
Q: Problem 11-6 (Algorithmic) Special Deductions and Limitations (LO 11.3) Beech Corporation, an…
A: The organizational expense includes the cost which would otherwise be recorded as a capital…
Q: On the consolidated balance sheet, consolidated retained earnings at the end of the year is: A.…
A: Retained earnings balances fluctuate over time based on how well a business does financially and how…
Q: Prepare a schedule of cash payments for selling and administrative expenses for March, April, and…
A: To prepare a schedule of cash payments for selling and administrative expenses for March, April, and…
Q: Whirly Corporation's most recent income statement is shown below: Total Per Unit Sales (7,900 units)…
A: MARGINAL COSTING INCOME STATEMENTMarginal Costing Income Statement is one of the Important Cost…
Q: Best, Inc. produced 1,000 units of the company's product in 2024. The standard quantity of direct…
A: The variance is the difference between the standard and actual cost data. The variance can be…
Q: What would be the total combined direct labor cost for the two months? Multiple Choice…
A: This expenditure represents the payment made to the labor force, which is directly involve in the…
Q: Cameron Industries is purchasing a new chemical vapor depositor in order to make silicon chips. It…
A: The free cash flow is the excess or deficit amount of cash flow from operating activities after…
Q: Distinct features between management accounting and financial accounting
A: The objective of this question is to distinguish between management accounting and financial…
Q: Q. 6. Compute the complement rate and the net price using the complement method. List Trade…
A: The complement rate is the value that remains after deducting the trade discount. Other than this…
Q: On January 2, 2021, Twilight Hospital purchased a $100,000 special radiology scanner from Blossom…
A: Depreciation expense :— It is the allocation of depreciable cost of asset over the estimated useful…
Q: tives Limited plans to Issue $550,000, 10-year, 6.50 percent bonds. Interest is payable annually on…
A: Issuing bonds at a premium occurs when a company sells its bonds to investors at a price exceeding…
Q: Pharoah Company ended its fiscal year on July 31, 2022. The company's adjusted trial balance as of…
A: A financial statement that details the amounts of cash and cash equivalents that enter and leave a…
Q: Q. 7. Find the complement rates (where none exists, enter an "*") and the net price using the…
A: The amount at which a good or service is sold after deducting all discounts and adding all…
Q: Assume that IBM leased equipment that was carried at a cost of $195,000 to Cullumber Company. The…
A: A lease is defined as a contractual agreement incorporated between two business entities where one…
Q: a H 12 15 18 An oil
A: Depletion is an accounting and tax concept used most often in the mining, timber, and petroleum…
Q: Machinery was bought October 2,2021. The total purchase cost was $182 900 which is inclusive of $600…
A: The objective of the question is to determine the cost of the machinery. The cost of an asset…
Q: Arrow is a full-time exempt employee in Sitka, Alaska, who earns $76,500.00 annually. She is married…
A: Taxable income is the amount of the person's income that is taxed after all the deductions and…
Q: Here are selected 2027 transactions of Swifty Corporation. Jan. 1 June 30 Dec. 31 Jan. 1 Prepare a…
A: The accounting equation is a fundamental principle in accounting that represents the relationship…
Q: Fill in the missing cells in the following cash budget. Interpret the values for NCF and the ending…
A: Lets understand the budget.Management prepares budget in order to estimate future profit and…
Q: On December 1, 2022, Coronado Company had the account balances shown below. Cash Accounts Receivable…
A: The Last in, First Out (LIFO) technique of inventory costing operates under the assumption that…
Q: Lifestyle Roofing uses job order costing and applies manufacturing overhead too individual projects…
A: The job order costing is the costing system that determines the total cost associated with each job…
Q: Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier.…
A: A budget that is prepared for varying activity levels, capacity utilization, or output volumes is…
Q: achieve a profit of P6 600 for the period
A: To calculate the number of units to be produced and sold to achieve a profit of P6 600 for the…
Q: On April 1, 20X1, German Corporation issued $100,000 of 7%, 5-year bonds dated April 1, 20X1, at…
A: A straight line amortization method is the way a business records the amortization of premium or…
Q: A company currently produces three products from a joint process. The joint process has total costs…
A: Lets understand the basics.When management having a option of sale or proceed further than…
Q: Bandar Industries Berhad of Malaysia manufactures sporting equipment One of the company's products,…
A: The variance is the difference between the standard and actual cost production data. The variance…
Q: MANUFACTURING OVERHEAD BUDGET Production in Units Variable OH Rate/Unit Anticipated VOH Costs Fixed…
A: In accounting, budgeting refers to the process of creating a financial plan for a specific period,…
Q: The South Division of Crane Company reported the following data for the current year. Sales Variable…
A: Return on investment is calculated by dividing net operating income by average operating assets. Net…
Q: Depletion On January 2, 2019, Whistler Company purchased land for $470,000, from which it is…
A: The cost of extracting natural resources from the earth, such as wood, minerals, and oil, is…
Q: XYZ Consulting bought new building for its headquarters in the year 2010. The purchase cost was…
A: Depreciation is the reduction in the value of asset due tonormal wear and tearEffluxion of…
Q: Debit
A: Refund liability is the amount of sale revenue that the company does not expect or is entitled to.…
Q: Star Garage Limited provides motor vehicle accessories and services for a wide range of vehicles in…
A: To create an integrated REA (Resources, Events, Agents) diagram for Star Garage Limited's revenue…
Q: MA-4 (Algo) Recording a Bond Investment Held as Trading Securities LO A-1 On January 1, 2024, Brian…
A: Bonds are the securities issued by a company that contain the face value of securities, interest…
Q: Oriole Corporation recorded warranty accruals as at December 31, 2023, in the amount of $154,000.…
A: When an asset or liability's tax base differs from its carrying amount as reported in the financial…
Q: Sandhill Company expects to produce 54,000 units of product XLA during the current year. Budgeted…
A: A flexible budget is prepared on the basis of the budgeted rate and on the basis of different…
Q: Flint Corp. uses a perpetual inventory system. The company had the following inventory transactions…
A: Journal Entry :— It is an act of recording transactions in books of account when transaction…
Q: Exercise 12-8 (Algo) Cost of Quality [LO12-2] Walton Company measured its quality costs for the past…
A: Last YearThis YearPrevention costs$378,400$591,500Appraisal costs$440,600$550,500Internal failure…
Q: On November 30, Brown Sugar Plc has the below information related to cheques and cash: The bank…
A: Lets understand the basics.Bank reconciliation: It is a statement drawn up by the business to verify…
Q: please solve for these questions: b-1. What is the labor efficiency variance? b-2. What is the…
A: Variance analysis is a method of measuring the difference between the standard numbers expected by…
Q: Tip Top Markets is a regional chain of supermarkets located in the Southeastern United States. Karen…
A: The check sheet is a quality analysis tool where the data is analyzed using the defects/errors and…
Q: On December 31, 2023, Wolfe-Bache Corporation failed to accrue salaries expense of $1,600. workweek,…
A: A journal entry is a basic accounting record that is used to chronologically track financial…
Q: Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains…
A: Standard costing is a practice which is mainly used in the manufacturing industry or businesses to…
Q: Sunland Technologies Inc. held a portfolio of shares and bonds that it accounted for using the fair…
A: An "unrealized loss" refers to a decrease in the value of an asset that has not yet been sold or…
Q: The Puyer Corporation makes and sells only one product called a Deb. The company is in the process…
A: VARIABLE COST Variable Cost is a cost that varies with the level of output.Variable costs include…
Q: Caribbean Gators Limited is a newly organized footwear manufacturing business that plans to…
A: Here in this question, we are required to calculate break even point.Break even point is a point at…
Q: Total Cost of Production for One Month:
A: An income statement or profit and loss account is one of the financial statements of a company and…
Q: Novak Limited owns a 26% interest in the shares of Marigold Corporation. During the year, Marigold…
A: A consolidated financial statement is prepared by the parent company that indicates the company's…
Q: Kiyara (single) is a 50 percent shareholder of Guardian Corporation (an S Corporation). Kiyara does…
A: The payroll tax includes Social security And Medicare taxes, as well as various income tax…
Q: Green Company sells its single product for $75 per unit. Variable costs are $54 per unit and the…
A: MARGINAL COSTING INCOME STATEMENTMarginal Costing Income Statement is one of the Important Cost…
Step by step
Solved in 5 steps with 2 images
- On November 1, 2020, Cheng Company (a U.S.-based company) forecasts the purchase of goods from a foreign supplier for 100,000 yuan. Cheng expects to receive the goods on April 30, 2021, and make immediate payment. On November 1, 2020, Cheng enters into a six-month forward contract to buy 100,000 yuan. The company properly designates the forward contract as a cash flow hedge of a forecasted foreign currency transaction. Forward points are excluded in assessing hedge effectiveness and are amortized to net income using a straight-line method on a monthly basis over the life of the contract. The following U.S. dollar–Yuan exchange rates apply: Date Spot Rate Forward Rate(to April 30, 2021) November 1, 2020 $ 0.21 $ 0.195 December 31, 2020 0.19 0.170 April 30, 2021 0.18 N/A As expected, Cheng receives goods from the foreign supplier on April 30, 2021, and pays 100,000 yuan immediately. Cheng sells the imported goods in the local market in May 2021.…Shandra Corporation (a U.S.-based company) expects to order goods from a foreign supplier at a price of 107,000 pounds, with delivery and payment to be made on June 15. On April 15, when the spot rate is $1.27 per pound, Shandra purchases a two-month call option on 107,000 pounds and designates this option as a cash flow hedge of a forecasted foreign currency transaction. The time value of the option is excluded in assessing hedge effectiveness; the change in time value is recognized in net income over the life of the option. The option has a strike price of $1.27 per pound and costs $1,070. The goods are received and paid for on June 15. Shandra sells the imported goods in the local market immediately. The spot rate for pounds is $1.320 on June 15, Required: a-1. Prepare all journal entries for Shandra Corporation related to this transaction and hedge. a-2. What amount should Shandra Corporation report in net income as cost of goods sold for the quarter ending June 30? b. What amount…Shandra Corporation (a U.S. -based company) expects to order goods from a foreign supplier at a price of 117,000 pounds, with delivery and payment to be made on June 15. On April 15, when the spot rate is $1.31 per pound, Shandra purchases a two-month call option on 117,000 pounds and designates this option as a cash flow hedge of a forecasted foreign currency transaction. The time value of the option is excluded in assessing hedge effectiveness; the change in time value is recognized in net income over the life of the option. The option has a strike price of $1.31 per pound and costs $1, 170. The goods are received and paid for on June 15. Shandra sells the imported goods in the local market immediately. The spot rate for pounds is $1.360 on June 15. a-1. Prepare all journal entries for Shandra Corporation related to this transaction and hedge. a-2. What amount should Shandra Corporation report in net income as cost of goods sold for the quarter ending June 30? b. What amount should…
- Shandra Corporation (a U.S.-based company) expects to order goods from a foreign supplier at a price of 100,000 pounds, with delivery and payment to be made on April 20. On February 20, when the spot rate is $1.36 per pound, Shandra purchases a two-month call option on 100,000 pounds and designates this option as a cash flow hedge of a forecasted foreign currency transaction. The time value of the option is excluded in assessing hedge effectiveness; the change in time value is recognized in net income over the life of the option. The option has a strike price of $1.36 per pound and costs $1,000. The goods are received and paid for on April 20. Shandra sells the imported goods in the local market by May 31. The spot rate for pounds is $1.41 on April 20. What amount will Shandra Corporation report as foreign exchange gain or loss in net income for the quarter ended June 30? $5,000. $0. $1,000. $2,000.On November 1, 2020, Cheng Company (a U.S.-based company) forecasts the purchase of goods from a foreign supplier for 130,000 yuan. Cheng expects to receive the goods on April 30, 2021, and make immediate payment. On November 1, 2020, Cheng enters into a six-month forward contract to buy 130,000 yuan. The company properly designates the forward contract as a cash flow hedge of a forecasted foreign currency transaction. Forward points are excluded in assessing hedge effectiveness and are amortized to net income using a straight-line method on a monthly basis over the life of the contract. The following U.S. dollar–Yuan exchange rates apply: Date Spot Rate Forward Rate (to April 30, 2021) November 1, 2020 $ 0.24 $ 0.225 December 31, 2020 0.23 0.200 April 30, 2021 0.21 N/A As expected, Cheng receives goods from the foreign supplier on April 30, 2021, and pays 130,000 yuan immediately. Cheng sells the imported goods in the local market in May 2021. Prepare all journal entries, including…21. On April 1, Quality Corporation, a U.S. company, expects to sell merchandise to a French customer in three months, denominating the transaction in euros. On April 1, the spot rate is $1.41 per euro, and Quality enters into a three-month forward contract cash flow hedge to sell 400,000 euros at a rate of $1.36. At the end of three months, the spot rate is $1.37 per euro, and Quality delivers the merchandise, collecting 400,000 euros. What amount will Quality recognize in Sales from these transactions? a.0 b.400,000 c.544000 d.548000 e.564000
- On November 1, 2023, Cheng Company (a U.S.-based company) forecasts the purchase of goods from a foreign supplier for 310,000 yuan. Cheng expects to receive the goods on April 30, 2024, and make immediate payment. On November 1, 2023, Cheng enters a six-month forward contract to buy 310,000 yuan. The company properly designates the forward contract as a cash flow hedge of a forecasted foreign currency transaction. Forward points excluded in assessing hedge effectiveness and amortized to net income using a straight-line method on a monthly basis over the life of the contract. The following U.S. dollar–Yuan exchange rates apply: Date Spot Rate Forward Rate (to April 30, 2024) November 1, 2023 $ 0.42 $ 0.405 December 31, 2023 0.41 0.380 April 30, 2024 0.39 N/A As expected, Cheng receives goods from the foreign supplier on April 30, 2024, and pays 310,000 yuan immediately. Cheng sells the imported goods in the local market in May 2024. Required: Prepare all journal entries,…Torres Corporation (a U.S.-based company) expects to order goods from a foreign supplier at a price of 106,000 pounds, with delivery and payment to be made on September 20. On July 20, Torres purchased a two-month call option on 106,000 pounds and designated this option as a cash flow hedge of a forecasted foreign currency transaction. The option has a strike price of $1.35 per pound and costs $1,060. The spot rate for pounds is $1.35 on June 20 and $1.40 on September 20. What amount will Torres Corporation report as an option expense in net income for the quarter ended September 30? Multiple Choice $530. $5,300. $2,300. $1,060.Consider a U.S.-based company that exports goods to Switzerland. The U.S. company expects to receive a payment of 50,000 Swiss Francs (CHF) on a shipment of goods in 6 months' time. The U.S. interest rate is 2% p.a., and the Swiss interest rate is 4% p.a. Assume that the current spot rate is CHF0.96/USD. Which of the following statements is correct: The risk to the U.S. company is that the value of the Swiss franc will rise and therefore it should enter into a contract to buy Swiss francs forward The risk to the U.S. company is that the value of the Swiss franc will decline and therefore it should enter into a contract to buy Swiss francs forward The risk to the U.S. company is that the value of the Swiss franc will decline and therefore it should enter into a contract to sell Swiss francs forward The risk to the U.S. company is that the value of the Swiss franc will rise and therefore it should enter into a contract to sell Swiss francs forward
- Brexylite plc is due to pay €1,750,000 to its European suppliers in 3 months’ time. The financial manager has decided to hedge the currency risk of this account payable. The following information has been provided by the company’s bank: Spot rate (£ per €): 1·1410 ± 0·0022 3 months forward rate (£ per €): 1·1574 ± 0·0041 6 months forward rate (£ per €) 1.1582 ± 0.0032 Calculate the expected (£) Stirling payment if the 3 months forward market is usedTorres Corporation (a U.S.-based company) expects to order goods from a foreign supplier at a price of 100,000 pounds, with delivery and payment to be made on September 20. On July 20, Torres purchased a two-month call option on 100,000 pounds and designated this option as a cash flow hedge of a forecasted foreign currency transaction. The option has a strike price of $1.25 per pound and costs $600. The spot rate for pounds is $1.25 on June 20 and $1.30 on September 20. What amount will Torres Corporation report as an option expense in net income for the quarter ended September 30? Choose the correct.a. $300b. $600c. $2,000d. $5,0001. The following Information should be used for Questions 1 and 2. The treasurer of X wants to hedge an exposure to currency risk. X is a company whose domestic currency is the euro, and the company must make a payment of US $500 000 to a US supplier in 6 months' time. The following market rates are available: Exchange rates: $ per €1 Spot= 1.604 ± 0.002 6 months forward= 1.570 ± 0.004 6 month interest rates: Euro Borrowing= 4.8%. Euro Deposits= 4.4% US dollar Borrowing= 2.5%. US dollar Deposits= 2.0%. What would be the euro cost to X if he hedges through a forward contract? (a) Euro 326, 495 (b) Euro 319, 285 (c) Euro 313, 525 (d) Euro 333, 295 2. What would be the cost to X if he hedges through the money market? (a) USD 634, 631 (b) USD 631, 634 (c) Euro 316, 634 (d) Euro 316, 436