Marconi Products sells its products to countries around the world.On December 1, Year 3,Marconi sold products to a company in a foreign country at a total cost of 650,000 foreign currency units (FCs) when the spot rate was FC1 = $0.589.The terms of the sale required payment by April 1, Year 4. On December 3, Year 3, Marconi entered into a forward contract with the Bank of Nova Scotia at the 120-day forward rate of FC1 - $0.629.Hedge accounting is not applied.

The fiscal year-end of Marconi is December 31, and on this date the spot rate was FC1 = $0.602 and the forward rate was FC1 = $0.639. The payment from the foreign customer was received on April 1, Year 4, when the spot rate was FC1 = $0.647.

Required:

1.Prepare the journal entries to record

a.The sale and forward contract.

b.Any adjustments required on December 31.

c.The cash received in Year 4.

2.Prepare the partial Balance Sheet of Marconi on December 31, Year 3, that shows the presentation of the receivable and the accounts associated with the forward contract.