Emu Exports Ltd sold products to a New Zealand company.The sales contract was denominated in $NZ.On 1 October 2015,$NZ500 000 worth of products were sold with the terms f.o.b.shipping point and payment due 30 December 2015.A forward-exchange contract in which the bank agrees to purchase $NZ300 000 from Emu Exports on 30 December 2015 is entered into on 1 November 2015.The forward-exchange rate is A$1 = $NZ1.25.Other exchange rates are as follows: $$\begin{array} { | l | l | }
\hline 1 \text { October } 2015 & \text { A\$1.00 } = \text {\$NZ1.12 } \
\hline 1 \text { November } 2015 & \text { A\$1.00 } = \text { \$NZ1.20 } \
\hline 30 \text { December } 2015 & \text { A\$1.00 } = \text { \$NZ1.30 } \
\hline
\end{array}$$ What are the journal entries to record the above transactions from 1 October through to 30 December 2015 in accordance with AASB 121 (rounded to the nearest whole A$)?

Question

Emu Exports Ltd sold products to a New Zealand company.The sales contract was denominated in $NZ.On 1 October 2015,$NZ500 000 worth of products were sold with the terms f.o.b.shipping point and payment due 30 December 2015.A forward-exchange contract in which the bank agrees to purchase $NZ300 000 from Emu Exports on 30 December 2015 is entered into on 1 November 2015.The forward-exchange rate is A$1 = $NZ1.25.Other exchange rates are as follows: $$\begin{array} { | l | l | } 
\hline 1 \text { October } 2015 & \text { A\$1.00 } = \text {\$NZ1.12 } \
\hline 1 \text { November } 2015 & \text { A\$1.00 } = \text { \$NZ1.20 } \
\hline 30 \text { December } 2015 & \text { A\$1.00 } = \text { \$NZ1.30 } \
\hline
\end{array}$$ What are the journal entries to record the above transactions from 1 October through to 30 December 2015 in accordance with AASB 121 (rounded to the nearest whole A$)?

Quizplus · Accepted Answer

The Answer of Emu Exports Ltd sold products to a New Zealand company.The sales contract was denominated in $NZ.On 1 October 2015,$NZ500 000 worth of products were sold with the terms f.o.b.shipping point and payment due 30 December 2015.A forward-exchange contract in which the bank agrees to purchase $NZ300 000 from Emu Exports on 30 December 2015 is entered into on 1 November 2015.The forward-exchange rate is A$1 = $NZ1.25.Other exchange rates are as follows: $$\begin{array} { | l | l | } 
\hline 1 \text { October } 2015 & \text { A\$1.00 } = \text {\$NZ1.12 } \
\hline 1 \text { November } 2015 & \text { A\$1.00 } = \text { \$NZ1.20 } \
\hline 30 \text { December } 2015 & \text { A\$1.00 } = \text { \$NZ1.30 } \
\hline
\end{array}$$ What are the journal entries to record the above transactions from 1 October through to 30 December 2015 in accordance with AASB 121 (rounded to the nearest whole A$)?

Emu Exports Ltd Sold Products to a New Zealand Company