On December 5, 20X8, Texas based Imperial Corporation purchased goods from a Saudi Arabian firm for 100,000 riyals (SAR), to be paid on January 10, 20X9. The transaction is denominated in Saudi riyals. Imperial's fiscal year ends on December 31, and its reporting currency is the U.S. dollar. The exchange rates are:

December 5, 20X8	1 riyal =	$	0.265
December 31, 20X8	1 riyal =		0.262
January 10, 20X9	1 riyal =		0.264

Based on the preceding information, what journal entry would Imperial make on December 31, 20X8, to revalue foreign currency payable to equivalent U.S. dollar value?

A.	Accounts Payable (SAR)	300
	Foreign Currency Transaction Gain		300
B.	Accounts Payable (SAR)	100
	Foreign Currency Transaction Gain		100
C.	Foreign Currency Transaction Loss	300
	Accounts Payable (SAR)		300
D.	Foreign Currency Transaction Loss	200
	Accounts Payable (SAR)		200

Multiple Choice

• Option A

• Option B

• Option C

• Option D

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On December 5, 20X8, Texas based Imperial Corporation purchased goods from a Saudi Arabian firm for 100,000 riyals (SAR), to be paid on January 10, 20X9. The transaction is denominated in Saudi riyals. Imperial's fiscal year ends on December 31, and its reporting currency is the U.S. dollar. The exchange rates are:

December 5, 20X8	1 riyal =	$	0.265
December 31, 20X8	1 riyal =		0.262
January 10, 20X9	1 riyal =		0.264

Based on the preceding information, what journal entry would Imperial make on January 10, 20X9, to revalue foreign currency payable to equivalent U.S. dollar value?

A.	Accounts Payable (SAR)	300
	Foreign Currency Transaction Gain		300
B.	Accounts Payable (SAR)	100
	Foreign Currency Transaction Gain		100
C.	Foreign Currency Transaction Loss	100
	Accounts Payable (SAR)		100
D.	Foreign Currency Transaction Loss	200
	Accounts Payable (SAR)		200

Multiple Choice

• Option A

• Option B

• Option C

• Option D

Based on the preceding information, what was the overall foreign currency gain or loss on the accounts payable transaction?

Multiple Choice

• $300 loss

• $200 loss

• $100 gain

• $200 gain