Exercise 12-1 Selco, a U.S. Company, Imports and exports tools, shop equipment, and industrial construction supplies. The company uses a periodic Inventory system. During April the company entered into the following transactions. All rate quotations are direct exchange rates. April 3 5 9 11 16 18 22 30 Purchased power tools from a wholesaler in Japan, on account, at an invoice cost of 1,750,000 yen. On this date the exchange rate for the yen was $0.0078. Sold hand tools on credit that were manufactured in the U.S. to a retail outlet located in West Germany. The invoice price was $2,600. The exchange rate for marks was $0.5255. Sold electric drills on account to a retailer in New Zealand. The invoice price was 17,800 U.S. dollars and the exchange rate for the New Zealand dollar was $0.5181. Purchased drill bits on account from a manufacturer located in Belgium. The big was for 801,282 francs. The exchange rate for francs was $0.0312 Paid 1,070,000 yen on account to the wholesaler for purchases made on April 3. The exchange rate on this date was $0.0073 Settled the accounts payable with the Belgium manufacturer. The exchange rate was $0.0365. Received full payment from the New Zealand retailer. The exchange rate was $0.5101 Completed payment on the April 3 purchase. The exchange rate was $0.0084 Prepare journal entries on the books of Selco to record the transactions listed above. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry for the account titles and enter for the amounts. Round answers to O decimal places, e.g. 5,125.) Date Account Titles and Explanation Debit Credit Apr. 18 Apr. 30 Accounts Payable Accounts Receivable Cash Cost of Goods Sold Dollars Payable to Exchange Dealer Dollars Receivable from Exchange Dealer Equipment FC Contract FC Payable to Exchange Dealer FC Receivable from Exchange Dealer Firm Commitment Foreign Exchange Contract Foreign Exchange Gain Foreign Exchange Gain - Other Comprehensive Income Foreign Exchange Loss Foreign Exchange Loss - Other Comprehensive Income Interest Expense Inventory Investment in FC No Entry Notes Payable Option to Buy FC Option to Sell Francs Option to Sell Kronas Payable to Option Trader Purchases Realized Gain Realized Loss Revenues Sales Service Revenue Transaction Gain Transaction Loss List Of Accounts Exercise 12-1 Accounts Payable Accounts Receivable Cash Cost of Goods Sold Dollars Payable to Exchange Dealer Dollars Receivable from Exchange Dealer Equipment FC Contract FC Payable to Exchange Dealer FC Receivable from Exchange Dealer Firm Commitment Foreign Exchange Contract Foreign Exchange Gain Foreign Exchange Gain - Other Comprehensive Income Foreign Exchange Loss Foreign Exchange Loss - Other Comprehensive Income Interest Expense Inventory
