Orange Peel, a U.S. company, sold 140,000 cases of tropical fruit to Hanoi Foods, a Vietnamese firm, for 4.25 billion Vietnamese dong. The sale was made on November 17, 2012, when one U.S. dollar equaled 17,000 dong. Payment of 4.25 billion Vietnamese dong was due to Orange Peel on January 16, 2013. At December 31, 2012, one U.S. dollar equaled 17,600 dong, and on January 16, 2013, one U.S. dollar equaled 18,200 dong.
1. What will be the value of the accounts receivable on December 31, 2012, in Vietnamese dong?
2. What will be the value of the accounts receivable on December 31, 2012, in U.S. dollars?
3. Will Orange Peel recognize an exchange gain or loss at December 31, 2012? Explain.
4. Will Orange Peel recognize an exchange gain or loss on January 16, 2013? Explain.
5. In connection with this sale, what amount will Orange Peel report as Sales Revenue in its income statement for 2012?
6. In connection with this sale, what amount will Orange Peel report as Cash Collected from Customers in its statement of cash flows for 2013?