Icebreaker Company $($a U$.$S$.-$based company$)$ purchases materlals from a forelgn supplier on December $1,2023,$ with payment of $15,000$ dinars to be made on March $1,2024.$ The materlals are consumed Immedlately and recognized as cost of goods sold at the date of purchase. On December $1,2023,$ Icebreaker enters Into a forward contract to purchase $15,000$ dinars on March $1,2024.$ Relevant exchange rates for the dinar on varlous dates are as follows:

$\backslash$table$[[$Date$,$Spot Rate,Forward Rate $($to$],[$March $1,2024),,]]$

Required:

a$-1.$ Assuming that Icebreaker designates the forward contract as a cash flow hedge of a forelgn currency payable, prepare journal entries for the import purchase and foreign currency forward contract In U$.$S$.$ dollars.

a$-2.$ What is the impact on $2023$ net income?

a$-3.$ What is the impact on $2024$ net income?

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

b$-1.$ Assuming that Icebreaker designates the forward contract as a fair value hedge of a foreign currency payable, prepare journal entries for the import purchase and forelgn c$$rrency forward contract in U$.$S$.$ dollars.

b$-2.$ What is the impact on net income in $2023$ and in $2024?$

b$-3.$ What is the impact on net income over the two accounting periods?

Complete this question by entering your answers in the tabs below.

Req A$1$

Req A$2$ to A$4$

Req B$1$

Req B$2$ to B$3$

Assuming that Icebreaker designates the forward contract as a fair value hedge of a foreign currency payable, prepare journal entries for the import purchase and foreign currency forward contract in U$.$S$.$ dollars.

Note: If no entry is required for a transaction$/$event$,$ select $"$No Joumal Entry Required" in the first account field. Da not round intermediate calculations.

Show less $4$

Journal entry worksheet

$9$

$a$

A

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f

$7$

$9$

$19$