Exchange Transactions The Worldwide Company sent its catalog to several distributors in foreign countries this year, and, for the first time, it received orders from outside the United States. Thus far, all buyers have paid in U.S. dollars. However, next year Worldwide is considering accepting payment in other currencies. To demonstrate how payments in foreign currencies would affect the company, you agree to illustrate how some of this year’s sales would have been reported in the financial statements if the payments had been received in other currencies. For each of the following sales transactions, show how the transaction was reported at the date of sale and the date of collection in dollars, and how the transaction would have been reported if the payment had been received in the foreign currency of the customer:

a. A sale of $53,000 to a German customer made on account to be paid in 30 days. The spot rate at the date of sale was 1.82 marks to $1. At the collection date, the rate was 1.84 marks to $1.

b. A sale of $87,000 to a French customer made on account to be paid in 60 days. The spot rate at the date of sale was 6.18 francs to $1. At the collection date, the rate was 6.15 francs to $1.

c. A sale of $21,000 to an Australian customer was collected in cash. The spot rate at the date of the sale was 1.53 Australian dollars to $1 (U.S.).