On December 1, 20X1, Micro World Incorporation entered into a 120-day forward contract to sell 100,000 Australian dollars (A$). Micro World's fiscal year ends on December 31. The direct exchange rates follow: Date December 1, 20x1 December 31, 20x1 January 30, 20x2 March 31, 20x2 Required: Spot Rate Forward Rate for March 31, 20x2 $ 0.600 0.610 0.608 0.602 $ 0.609 0.612 0.605 Prepare all journal entries for Micro World Incorporated for the following independent situations. 1. The forward contract was to manage the foreign currency risks from the sale of furniture for A$100,000 on December 1, 20X1, with payment due on March 31, 20X2. The forward contract is not designated as a hedge. 2. The forward contract was to hedge an anticipated sale of furniture on January 30. The sale took place on January 30 with payment due on March 31, 20X2. The derivative is designated as a cash flow hedge. The company uses the forward exchange rate to measure hedge effectiveness. 3. The forward contract was for speculative purposes only. Required 1 Required 2 Required 3 The forward contract was to manage the foreign currency risks from the sale of furniture for A$100,000 on December 1, 20X1, with payment due on March 31, 20X2. The forward contract is not designated as a hedge. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Date General Journal 1 December 1, 20X1 Accounts receivable (A$) Sales 2 December 1, 20X1 No journal entry required 3 December 31, 20X1 No journal entry required 4 December 31, 20X1 No journal entry required 5 January 30, 20X2 No journal entry required 6 March 31, 20X2 No journal entry required 7 March 31, 20X2 No journal entry required Debit Credit 66,000 66,000 Required 1 Required 2 Required 3 The forward contract was to hedge an anticipated sale of furniture on January 30. The sale took place on January 30 with payment due on March 31, 20X2. The derivative is designated as a cash flow hedge. The company uses the forward exchange rate to measure hedge effectiveness. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Date General Journal 1 December 1, 20X1 No journal entry required 2 December 31, 20X1 No journal entry required 3 January 30, 20X2 No journal entry required 4 January 30, 20X2 No journal entry required 5 March 31, 20X2 No journal entry required 6 March 31, 20X2 No journal entry required Mach 1 novo d Show less Debit Credit Required 1 Required 2 Required 3 The forward contract was for speculative purposes only. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Date General Journal 1 December 1, 20X1 No journal entry required 2 December 31, 20X1 No journal entry required 3 March 31, 20X2 No journal entry required 4 March 31, 20X2 No journal entry required 5 March 31, 20X2 No journal entry required < Required 2 Required 3 Debit Credit