Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer this asap Icebreaker Company (a U.S.based company) sells parts to a foreign customer on December 1, 2020, with payment of 16,000 dinars to

please answer this asap image text in transcribed
Icebreaker Company (a U.S.based company) sells parts to a foreign customer on December 1, 2020, with payment of 16,000 dinars to be received on March 1, 2021. Icebreaker enters into a forward contract on December 1, 2020, to sell 16.000 dinars on March 1, 2021 . The forward points on the forward contract are excluded in assessing hedge effectiveness and are amortized to net income using a straight-line method on a monthly basis. Relevant exchange rates for the dinar on various dates are as follows. Icebreaker must close its books and prepare financial statements at December 31 0.1. Assuming that icebreaker designates the forward contract as a cash flow hedge of a foreign currency receivable, prepare journal entries for the sale and foreign currency forward contract in U.S. dollars. a.2. What is the impact on 2020 net income? 0.3. What is the impact on 2021 net income? 0.4. What is the impact on net income over the two accounting periods? b-1 Assuming that lcebreaker designates the forward contract as a fair value hedge of a foreign currency receivable, prepare journal entries for the sale and foreign currency forward contract in US. dollars. b. 2 What is the impact on 2020 net income? b. 3 What is the impact on 2021 net income? b. 4 What is the impact on net income over the two accounting periods? Complete this question by entering your answers in the tabs below. Assuming that Icebreaker designates the forward contract as a cash flow hedge of a foreign currency receivable, prepare journal entries for the sale and forcign currency forward contract in U.S. dollars. (If no entry is required for a transaction/erent, select T. To journal entry required" in the first account field Do not tound intermediate calculations.) Journal entry worksheet

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

How To Audit Learn How To Become An Auditor

Authors: Mireya Knolton

1st Edition

B097KPLYBF, 979-8524922564

More Books

Students also viewed these Accounting questions

Question

Explain the factors that determine the degree of decentralisation

Answered: 1 week ago

Question

What Is acidity?

Answered: 1 week ago

Question

Explain the principles of delegation

Answered: 1 week ago

Question

State the importance of motivation

Answered: 1 week ago

Question

Discuss the various steps involved in the process of planning

Answered: 1 week ago