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Assume that a US company, an exporter, sells merchandise to a customer in Germany on December 1, 2020, for 10,000. The receipt is due on
Assume that a US company, an exporter, sells merchandise to a customer in Germany on December 1, 2020, for 10,000. The receipt is due on January 31, 2021, and the US company prepares financial statements on December 31, 2020. At the transaction date (December 1, 2020), the spot rate for the immediate exchange of foreign currencies indicates that 1 is equivalent to $1.18, and the spot rate for the immediate exchange of foreign currencies indicates that 1 is equivalent to $1.122 on December 31, 2020 On December 31, 2020, the foreign currency transaction should be recorded by the US company Accounts receivable-Germany $11,800 O Sales $11,800 Foreign Exchange losses $ 400 0 Accounts receivable-Germany $ 400 Accounts receivable-Germany $ 400 foreign exchange gain $ 400 Purchases $11,800 Accounts payable American $11,800 Under IFRS 1 the deferred tax assets tis Recognition o Derecognition o Assets O Libilities o
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