On December 10, 2023, Daisy Foods, a U.S. company, anticipates sales in the amount of A$25,000,000 to an Australian customer, payment in Australian dollars to be received at the end of May 2024. On December 10, 2023, Daisy Foods enters a forward contract for the sale of A$25,000,000 for a total price of $19,597,500 on May 31, 2024. The forward contract qualifies as a hedge of the forecasted sale. On March 1, 2024, Daisy delivered the merchandise to the Australian customer. On May 31, 2024, Daisy received A$25,000,000 from the customer, and delivered it to the broker to close the forward contract. Daisy Foods accounting year ends January 31. Relevant exchange rates ($/A$) are as follows:

Spot rate Forward rate for delivery May 31, 2024 December 10, 2023 $ 0.7841 $ 0.7839 January 31, 2024 0.7832 0.7830 March 1, 2024 0.7798 0.7796 May 31, 2024 0.7750 -

- Prepare the journal entries to record the above events, including January 31, 2024 adjusting entries. G

Answer Investment in forward contract Answer 5,402,500 Answer 0 Answer Other comprehensive income Answer 0 Answer 5,402,500 To record change in value of forward contract. 03/01/24 Answer Investment in forward contract Answer 5,402,500 Answer 0 Answer Other comprehensive income Answer 0 Answer 5,402,500 To record change in value of forward sale contract. Answer Accounts receivable Answer 19,495,000 Answer 0 Answer Sales revenue Answer 0 Answer 19,495,000 To record delivery of merchandise. Answer Other comprehensive income Answer 5,402,500 Answer 0 Answer Sales revenue Answer 0 Answer 5,402,500 To reclassify accumulated other comprehensive income. 05/31/24 Answer Exchange loss Answer 0 Answer 0 Answer Accounts receivable Answer 0 Answer 0 To adjust accounts receivable. Answer Investment in forward contract Answer 0 Answer 0 Answer Exchange gain Answer 0 Answer 0 To record change in value of forward contract. Answer Foreign currency Answer 0 Answer 0 Answer Accounts receivable Answer 0 Answer 0 To record payment from the customer. Answer Cash Correct Mark 1.00 out of 1.00 Answer 0 Answer 0 Investment in forward contract Answer 0 Answer 0 Answer Foreign currency Answer 0 Answer 0 To record settlement of the forward contract.