Cassowary Corporation's balance sheet at December 31, 20x3 included a $20,400 account receivable from Quail Corporation of Australia. The account receivable was denominated as 30,000 Australian dollars (A$). What entry did Cassowary make on January 16, 20x3 when the account receivable was collected and the exchange are for A$ was $.67?
a.
cash | 20,100 | |
accounts receivable | 20,100 |
b.
cash | 20,100 | |
exchange loss | 300 | |
accounts receivable | 2,400 |
c.
cash | 20,400 | |
accounts receivable | 20,400 |
d.
cash | 20,700 | |
accounts receivable | 20,400 | |
exchange gain | 300 |
Solution: No options in the above question is correct.
The Exact answer is as follows:
Cash [30000*$0.67] | $ 20,100 | |
Exchange Loss [Foreign Currency Transaction Loss] | $ 300 | |
Accounts receivables | $ 20,400 |
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