·1 (port ransactions Lo 1m1poru merchandise in several non-U.S. currencies. Belo
ID: 2553381 • Letter: #
Question
·1 (port ransactions Lo 1m1poru merchandise in several non-U.S. currencies. Below is a summary of transactions occurring in 2017 ° Sales to Canadian customers, totaling C$1,000,000, occurred when the exchange rate was $0.93/CS. Papa Pete S International is a U.S. tool distributor that buys and sells CS200,00? was for cash, but CS700000 was paid by customers when the rate was S0.924/CS, The remainder is unpaid at year-end. when the rate is SO.922/CS. 0o Sales to Italian customers, totaling €10,000,000, occurred when the exchange rate was $1.27/€·The company was paid 8,000,000 when the rate was $1.285. The remainder is unpaid at year-end, when the rate is S1.288. L o Purchases from Mexican suppliers, totaling Mex$3,000,000, occurred when the exchange rate was S0.075/MexS. The company paid the suppliers Mex$2,700,000 when the rate was $0.0782/MexS. The remainder is unpaid at year-end, when the rate is $0.0788/MexS. Mex$2,800,000 of the merchandise was sold by Papa Pete's during 2017. - Purchases from Hong Kong suppliers, totaling HK$4,000,000, occurred when the exchange rate was S0.129/HKS. The company paid the suppliers HKS3.400.000 when the rate was S0.123/HKS, and the remainder is unpaid at year-end, when the rate is $0.121/HKS. HKS3,600,000 of this merchandise was sold by Papa Pete's during 2017. Required Calculate the following amounts, appearing in Papa Pete's 2017 financial statements, related to the above information. Show calculations clearly. a. b. c. d. e. Accounts receivable and accounts payable, end of 2017 Sales revenue for 2017 Cost of goods sold for 2017 Inventory balance, end of 2017 Exchange gain or loss for 2017Explanation / Answer
a.
Accounts Receivable, end of 2017
Amount
Exchange Rate
Value
A
B
C = A*B
C$100,000
$0.922/C$
$ 92,200
€ 2,000,000
$1.288/€
$ 2,576,000
$ 2,668,200
Accounts Payable, end of 2017
Amount
Exchange Rate
Value
A
B
C = A*B
Mex$300,000
$0.0788/Mex$
$ 23,640
HK$600,000
$0.121/HK$
$ 72,600
$ 96,240
b.
Sales Revenue
Amount
Exchange Rate
Value
A
B
C = A*B
C$1,000,000
$0.93/C$
$ 930,000
€ 10,000,000
$1.27/€
$ 12,700,000
$ 13,630,000
c.
Purchases
Amount
Exchange Rate
Value
A
B
C = A*B
Mex$3,000,000
$0.075/Mex$
$ 225,000
HK$4,000,000
$0.129/HK$
$ 516,000
$ 741,000
Cost of Goods Sold
Amount
Exchange Rate
Value
A
B
C = A*B
Mex$2,800,000
$0.075/Mex$
$ 210,000
HK$3,600,000
$0.129/HK$
$ 464,400
$ 674,400
d.
Inventory Balance, end of 2017
Amount
Exchange Rate
Value
A
B
C = A*B
Mex$200,000
$0.075/Mex$
$ 15,000
HK$400,000
$0.129/HK$
$ 51,600
$ 66,600
Accounts Receivable, end of 2017
Amount
Exchange Rate
Value
A
B
C = A*B
C$100,000
$0.922/C$
$ 92,200
€ 2,000,000
$1.288/€
$ 2,576,000
$ 2,668,200
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