Brandlin Company of Anaheim, California, sells parts to a foreign customer on December 1, 2017, with payment of 16,000 korunas to be received on March 1, 2018. Brandlin enters into a forward contract on December 1, 2017, to sell 16,000 korunas on March 1, 2018. Relevant exchange rates for the koruna on various dates are as follows:

Date	Spot Rate			Forward Rate (to March 1, 2018)
December 1, 2017	$	3.40		$	3.475
December 31, 2017		3.50			3.600
March 1, 2018		3.65			N/A

Brandlin's incremental borrowing rate is 12 percent. The present value factor for two months at an annual interest rate of 12 percent (1 percent per month) is 0.9803. Brandlin must close its books and prepare financial statements at December 31.

a-1. Assuming that Brandlin designates the forward contract as a cash flow hedge of a foreign currency receivable and recognizes any premium or discount using the straight-line method, prepare journal entries for these transactions in U.S. dollars.

a-2. What is the impact on 2017 net income?

a-3. What is the impact on 2018 net income?

a-4. What is the impact on net income over the two accounting periods?

b-1. Assuming that Brandlin designates the forward contract as a fair value hedge of a foreign currency receivable, prepare journal entries for these transactions in U.S. dollars.

b-2. What is the impact on 2017 net income?

b-3. What is the impact on 2018 net income?

b-4. What is the impact on net income over the two accounting periods?

Req A2 to A4 Req B1 Req B2 to B4 Req A1 Assuming that Brandlin designates the forward contract as a cash flow hedge of a foreign currency receivable and recognizes any premium or discount using the straight-line method, prepare journal entries for these transactions in u. s. dollars.(If no entry is required for a transaction/event, select "Nojournal entry required" in the first account field. Do not round intermediate calculations, Round your final answers to 2 decimal places.) Show lesS No Date General Journal Debit Credit 12/01/2017 Accounts receivable (K 54,400.00 Sales 54.400.00 12/01/2017 No jounal entry required 12/31/2017 Accounts receivable (K 1,800.00 Foreign exchange gain 1800.00 12131 2017 Accumulated other comprehensive income 1,960.60 Fonward contract 1,960.60 12/31/2017 0.00 Loss on fomeard contract Accumulated other comprehensive income 1.600.00 12/31/2017 Accumulated other comprehensive income 1,600.00 Premium revenue 1,600.00 2,400.00 03/01/2018 Accounts receivable (K Foreign exchange gain 2.400.00 03/01/2018 Accumulated other comprehensive income 2,400,000 Fonward contract 2.400.00 03/01/2018 Loss on fonward contract 2.400.00 Accumulated other comprehensive income 2.400.00 10 03/01/2018 No jounal entry required 03/01/2018 Foreign currency (K) 58,400.00 Accounts receivable (K) 58.400.00 12 03/01/2018 Cash Foreign currency (K) Fonward contract 58.400.00 0.00