Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please provide an answer that gives the exact amount of accounts for each line. Thank you On January 1, 2020, Crane Inc. agrees to buy

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

Please provide an answer that gives the exact amount of accounts for each line. Thank you

On January 1, 2020, Crane Inc. agrees to buy 3 kg of gold at $40,000 per kilogram from Golden Corp on April 1, 2020, but does not intend to take delivery of the gold. On the day that the contract was entered into, the fair value of this futures contract that trades on the Futures Exchange was zero. On January 1, 2020, Crane is required to deposit $70 with the stockbroker as a margin. The fair value of the futures subsequently fluctuated as follows: Date Fair Value of Futures Contract January 20, 2020 $466 February 6, 2020 $126 February 28, 2020 $370 March 14, 2020 $850 On the settlement date, the spot price of gold is $41,000 per kilogram. Assume that Crane complies with IFRS. Prepare the journal entry for the day the futures contract was signed. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit January 1, 2020 70 70 e Textbook and Media List of Accounts Prepare the journal entries to recognize the changes in the fair value of the futures contract. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Cred Prepare the journal entry that would be required if Crane settled the contract on a net basis on April 1, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit April 1, 2020

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

Accounting Information Systems A Practictioner Emphasis

Authors: Cynthia D. Heagy, Constance M. Lehmann

10th Edition

1891002821, 9781891002823

More Books

Students also viewed these Accounting questions

Question

Describe how childhood experiences affect self-esteem.

Answered: 1 week ago