Question
Mozzie Ltd has a functional currency of A$. On 1 April 2023, Mozzie Ltd sells goods to a customer on credit terms for US$80 000.
Mozzie Ltd has a functional currency of A$. On 1 April 2023, Mozzie Ltd sells goods to a customer on credit terms for US$80 000. On 1 August 2023, cash is received from the customer to settle the invoice. Exchange rates are: 1 April 2023 US$1.00 = A$1.30 30 June 2023 US$1.00 = A$1.55 1 August 2023 US$1.00 = A$1.45 What is the journal entry at the end of the reporting period on 30 June 2023?
a. DR. Accounts Receivable $20 000 CR. Foreign Exchange Gain $20 000
b. DR. Foreign Exchange Loss $20 000 CR. Accounts Receivable $20 000
c. DR. Accounts Receivable $124 000 CR. Sales $124 000
d. DR. Foreign Exchange Loss $9 925 CR. Accounts Receivable $9 925
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