Advanced Accounting Foreign Currency Transactions and Hedging Foreign Exchange Risk 449 28. Bartlett Company, headquartered in Cincinnati. Ohio. has occasional transactions with companies in a t)reign country whose currency is the lira. Prepare journal entries for the following transactions in U.S. dollars. Also prepare any necessary adjusting entries at December 31 caused by fluctuations in the value of the lira. Assume that the company uses a perpetual inventory system. Transactions n 2015 February 1 Bought equipment for 40,000 lira on credit. April 1 Paid for the equipment purchased February 1. June 1 Bought inventory for 30,000 lira on credit. August 1 Sold 70 percent of inventory purchased June 1 for 40,000 lira on credit. October 1 Collected 30,000 lira from the sales made oi August 1, 2015. November 1 Paid 20,000 lira on the debts incurred on June 1,2015. Transactions in 2016 February 1 Collected remaining 10,000 lira from August 1, 2015, sales. March 1 Paid remaining 10,000 lira on the debts incurred on June 1, 201 5. Currency exchange rates for 1 lira for 2015 February 1 $0.44 April 1 0.45 June 1 0.47 August 1 0.48 October 1 0.49 November 1 0.50 December 31 0.52 Currency exchange rates for 1 lira for 2016 February 1 $0.54 March 1 0.55