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Posted on Feb 10, 2024

Date November 1, 2023 December 31, 2023 April 30, 2024 Spot Rate $ 0.21 0.19 0.18 Forward Rate (to April 30, 2024) $ 0.195

Date November 1, 2023 December 31, 2023 April 30, 2024 Spot Rate $ 0.21 0.19 0.18 Forward Rate (to April 30, 2024) $ 0.195 0.170 N/A As expected, Cheng receives goods from the foreign supplier on April 30, 2024, and pays 100,000 yuan immediately. Cheng sells the imported goods in the local market in May 2024. Required: a. Prepare all journal entries, including December 31 adjusting entries, to record the foreign currency forward contract and import purchase. b. What is the impact on net income in 2023? c. What is the impact on net income in 2024?

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