Chapter 11 – Multinational Accounting: Foreign Currency Transactions And Financial Instruments
P11-20 (continued)
5.
a –
January 30, 20X9
Foreign Currency Transaction Loss
200
Foreign Currency Receivable from
Exchange Broker (Renminbi)
200
Adjust foreign currency receivable to current U.S. dollar equivalent:
$12,700 = 100,000 renminbi x $0.127 Jan. 30 spot rate
– 12,900 = 100,000 renminbi x $0.129 Dec. 31 forward rate
$ 200 = 100,000 renminbi x ($0.127 – $0.129)
Foreign Currency Units (Renminbi)
12,700
Foreign Currency Receivable
from Exchange Broker
12,700
Receive 100,000 renminbi from exchange broker:
$12,700 = 100,000 renminbi x $0.127 spot rate
