Please show the full solutions it would be greatly appreciated thanks so much and have a nice day!
Hamilton Importing Corp. (HIC) Imports goods from countries around the world for sale in Canada. On December 1, Year 3, HIC purchased 11.600 watches from a foreign wholesaler for DM616,000 when the spot rate was DM1 = $0.757. The Invoice called for payment to be made on April 1, Year 4. On December 3, Year 3. HIC entered into a forward contract with the Royal Bank at the 120-day forward rate of DM1 = $0.797. Hedge accounting is not applied. The fiscal year-end of HIC is December 31. On this date, the spot rate was DMt = $0.773 and the 90-day forward rate was DM1 = $0.802. The payment to the foreign supplier was made on April 1. Year 4. when the spot rate was DM1 = $0.818. Required: (a) Prepare the journal entries required in Year 3 and Year 4, assuming that hedge accounting is not applied. (In cases where no entry is required, please select the option "No journal entry required for your answer to grade correctly. Leave no cells blank - be certain to enter "O" wherever required.) General Journal Dabit Credit December 1, Year 3 Inventory 466312 Accounts payabla 466312 Record the purchase of inventory. Date December 3, Year 3 No journal entry required No journal entry required Record the forward contract. 0 December 31, Year 3 Exchange loss 9856 9856 Accounts payable Revalve accounts payable at fair value. Forward contract Exchange gain Revalue forvard contract at fair value. April 1, Year 4 27720 Exchange loss Accounts payable Revalue accounts payable at fair value. 27720 Forward contract Exchange gain Revalue forward contract at fair value. Cash (DM) Forward contract Cash Record the receipt of cash from bank. Accounts payable 503888 Cash (DM) Record the cash paid for purchase of inventory. 503888 (b) Prepare a partial statement of financial position as at December 31, Year 3. which shows accounts payable and the forward contract. (Omit $ sign in your response.) Hamilton Importing Corp. Partial Statement of Financial Position at December 31, Year 3 Assets Forward contract $ Liabilities Accounts payable 476168