Question
On 1 June 2016, Eastern Ltd made an initial cash margin deposit of $25,000 with its broker. On the same day it sold five (5)
On 1 June 2016, Eastern Ltd made an initial cash margin deposit of $25,000 with its broker. On the same day it sold five (5) October 2016 SPI 200 futures contracts, each unit is valued at $25.
The relevant prices for 2016 are as follows:
Date 1 June 30 June 31 July
Market price of SPI futures 1442 1450 1385
Market price of shares $175,000 $176,560 $169,000
Required
Assuming futures contracts are only for speculative purposes, prepare journal entries to record the above in the books of Eastern Ltd for the months of June and July.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Using Microcomputers In Managerial Accounting
Authors: George Hildebrand
1st Edition
0938188275, 978-0938188278
