On December 1, 20X1, Rone Imports, a U.S. company, purchased clocks from Switzerland for 15,000 francs (SFr), to be paid on January 15, 20X2. Rone's fiscal year ends on December 31, and Rone's reporting currency is the U.S. dollar. The exchange rates are:

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a. In which currency is the transaction denominated?

b. Prepare journal entries for Rone Imports to record the purchase, the adjustment on December 31, and the settlement.

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December 1. 20X1 December 31, 20X1 January 15, 20X2 1 SFr = $.70 1 SFr= .66 1 SFr= .68