Slickton Corporation, a U.S. holding company, enters into a forward contract on November 1, 2014 to speculate in Singapore dollars (S$). The forward contract requires Slickton to sell 1,000,000 Singapore dollars to the exchange broker on January 30, 2015. Net settlement is not permitted. Relevant exchange rates for the Singapore dollar are listed below:
Required:
Prepare the journal entries required by Slickton on November 1, 2014, December 31, 2014 (year end), and January 30, 2015.

Question

Slickton Corporation, a U.S. holding company, enters into a forward contract on November 1, 2014 to speculate in Singapore dollars (S$). The forward contract requires Slickton to sell 1,000,000 Singapore dollars to the exchange broker on January 30, 2015. Net settlement is not permitted. Relevant exchange rates for the Singapore dollar are listed below:
  Required:
Prepare the journal entries required by Slickton on November 1, 2014, December 31, 2014 (year end), and January 30, 2015.

Quizplus · Accepted Answer

The Answer of Slickton Corporation, a U.S. holding company, enters into a forward contract on November 1, 2014 to speculate in Singapore dollars (S$). The forward contract requires Slickton to sell 1,000,000 Singapore dollars to the exchange broker on January 30, 2015. Net settlement is not permitted. Relevant exchange rates for the Singapore dollar are listed below:
  Required:
Prepare the journal entries required by Slickton on November 1, 2014, December 31, 2014 (year end), and January 30, 2015.