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Please solve for the incorrect values On April 1, 2020, Mendoza Company (a U.S.-based company) borrowed 540.000 euros for one year at an interest rate
Please solve for the incorrect values
On April 1, 2020, Mendoza Company (a U.S.-based company) borrowed 540.000 euros for one year at an interest rate of 5 percent per annum. Mendoza must make its first interest payment on the loan on October 1, 2020. and will make a second interest payment on March 31, 2021. when the loan is repaid. Mendoza prepares U.S. dollar financial statements and has a December 31 year-end. Prepare all journal entries related to this foreign currency borrowing assuming the following exchange rates for 1 euro: U.S. Dollar per Euro Date April 1, 2020 October 1, 2020 December 31, 2020 March 31, 2021 $ 1.14 1.24 1.28 1.32 No Date Debit Credit Answer is complete but not entirely correct. General Journal Cash Accounts payable (euro) x 1 04/01/2020 615,600 615,600 2 10/01/2020 16,740 Interest expense Cash o 16,740 3 12/31/2020 8,370 % Interest expense Cash x 8,370 4 12/31/2020 Foreign exchange gain or loss Accounts payable (euro) O 75,600 x 75,600 5 03/31/2021 Interest expense Interest payable (euro) Foreign exchange gain or loss Cash OOOO 8,910 8,370 5403 17.820 6 03/31/2021 X Accounts payable (euro) Foreign exchange gain or loss Cash O 691,200 21,600 712,800Step by Step Solution
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