Exchanger Limited imports good from various countries abroad and has asked you, a trainee financial accountant for advice on how to account for the effects of changes in foreign exchange rates Exchanger Limited's year-end is 31 December, and its reporting or functional currency is the euro (NS) Exchanger Limited made a credit saloto a US customer on 1 October 2019 for US$100,000 The transaction was incorrectly recorded by Exchanger Limited as a sale of N$100,000 Exchanger Litted received part payment on 30 November 2019 of US$500,000 and this again was incorrectly recorded as N$ 500,000 in its records The following exchange rates applied during the financial year 1 October 2012 US$ TNS 12.50 30 November 2019 US$ 10 N$12.00 31 December 2019 USSTENS 1100 REQUIRED (a) The financial controle of Exchanger United has asked you to prepare a report which addresses the following In accordance with IAS 21 - The Effect of Changes in Foreign Exchange Rates describe what is meant by the following A foreign currency transaction (An exchange difference Outline how the following itens denominated in a foreign currency are restated to presentation currency (the functional currency is not the currency of hyperlotionaty economy W Assets and liabilitet 0) Income and expenses (1) Any resulting exchange differences (12 Marks) (6) Prepare journal entries to show how the above transactions should be recorded in the books of Exchange Limited for the year ended 31 December 2019 (10 Marks) (c) Calculate the foreign exchange gan or loss at the 31 December 2019 for Exchange Limited (3 Marks) QUESTION 3 PARTA (25 marka) 115. makal Exchanger Limited imports good from various countries abroad and has asked you, a trainee financial accountant for advice on how to account for the effects of changes in foreign exchange rates Exchanger Limited's year-end is 31 December, and its reporting or functional currency is the euro (NS) Exchanger Limited made a credit saloto a US customer on 1 October 2019 for US$100,000 The transaction was incorrectly recorded by Exchanger Limited as a sale of N$100,000 Exchanger Litted received part payment on 30 November 2019 of US$500,000 and this again was incorrectly recorded as N$ 500,000 in its records The following exchange rates applied during the financial year 1 October 2012 US$ TNS 12.50 30 November 2019 US$ 10 N$12.00 31 December 2019 USSTENS 1100 REQUIRED (a) The financial controle of Exchanger United has asked you to prepare a report which addresses the following In accordance with IAS 21 - The Effect of Changes in Foreign Exchange Rates describe what is meant by the following A foreign currency transaction (An exchange difference Outline how the following itens denominated in a foreign currency are restated to presentation currency (the functional currency is not the currency of hyperlotionaty economy W Assets and liabilitet 0) Income and expenses (1) Any resulting exchange differences (12 Marks) (6) Prepare journal entries to show how the above transactions should be recorded in the books of Exchange Limited for the year ended 31 December 2019 (10 Marks) (c) Calculate the foreign exchange gan or loss at the 31 December 2019 for Exchange Limited (3 Marks) QUESTION 3 PARTA (25 marka) 115. makal
