ACCT 4381 Winter 2022 Assignment #5 Instructions: Prepare your solution to this assignment in Excel, and submit it using the Blackboard dropbox by the due date. Marks will be awarded for a reasonable attempt. On September 1, 2021, Sennobus Company (Sennobus) ordered equipment, terms f.o.b. destination from Crescendo Corporation (Crescendo) for 3,500,000. The equipment was to be delivered on December 1, 2021 with payment due on February 1, 2022. Also on September 1, 2021, Sennobus Company entered into a forward contract with a bank expiring on February 1, 2022 to hedge its foreign currency exposure. On December 1, 2021, Crescendo delivered the equipment to Sennobus from its Toronto warehouse. Sennobus depreciates its equipment using a 20% declining balance rate. The following exchange rates occurred during the period (the forward rates shown all pertain to forward contracts expiring on February 1, 2022): Spot Rate September 1, 2021 December 1, 2021 Forward Rate 1=C$1.494 1= C$1.452 1 1 = C$1.526 C$1.498 December 31, 2021 February 1, 2022 1= C$1.445 1 = C$1.468 1= C$1.434 Required: Identify the hedged item and the hedging item. by Assuming that Sennobus chose not to apply hedge accounting, calculate the following amounts relating to the equipment purchase and the forward contract: Net cash received or paid Net foreign exchange gain or loss reported for the year ended December 31, 2021 Prepare the journal entries, including any adjusting entries for the equipment, to be recorded by Sennobus assuming that Sennobus Company applies hedge accounting and has designated the forward contract as a cash flow hedge September 1, 2021 December 1, 2021 December 31, 2021 - Sennobus's year end ix February 1, 2022