This is a two part question.

Part 1

GIVENS:

-On October 1, 2016 USA Company sold some chairs to Mexico Company for 500,000 pesos when the pesowas worth 10 cents.Payment is due April 1, 2017.

-On December 31, the peso is worth 8 cents.

-On April 1, the peso is worth 11 cents and Mexico Company pays its bill.

REQUIRED:

MAKE ALL THE NECESSARY JOURNAL ENTRIES FOR USA COMPANY IN 2016 AND 2017

Part 2

GIVENS:

-On October 1, 2016 USA Company sold some chairs to Mexico Company for 500,000 pesos when the pesowas worth 10 cents.Payment is due April 1, 2017.

-On October 2nd, USA enters into a forward contract when the 6 month forward price was 1 peso = 9 cents. Use 12% for interest.

-On December 31, the peso is worth 8 cents. The 3 month forward rate is 1 peso = 7 cents.

-On April 1, the peso is worth 11 cents and Mexico Company pays its bill.

REQUIRED:

MAKE ALL THE NECESSARY JOURNAL ENTRIES FOR USA COMPANY IN 2016 AND 2017. Remember, USA entered into a covered forward contract on October 2nd.

On October 1, 2016 USA Company sold some chairs to Mexico Company for 500,000 pesos when was worth 10 cents. Payment is due April 1, 2017 On December 31, the peso is worth 8 cents On April 1, the peso is worth 11 cents and Mexico Company pays its bill REQUIRED: MAKE ALL THE NECESSARY JOURNAL ENTRIES FOR USA COMPANY IN 2016 AND ompany for 500,000 pesos when the peso FOR USA COMPANY IN 2016 AND 2017 On October 1, 2016 USA Company sold some chairs to Mexico Company for 500,000 pesos when was worth 10 cents. Payment is due April 1, 2017 On October 2nd, USA enters into a forward contract when the 6 monthforward Use 12% for interest On December 31, the peso is worth 8 cents the 3 month forward rate is 1 peso = 7 cents On April 1, the peso is worth 11 cents and Mexico Company pays its bill REQUIRED: MAKE ALL THE NECESSARY JOURNAL ENTRIES FOR USA COMPANY IN 2016 AND Remember, USA entered into a covered forward contract on October 2 or 500,000 pesos when the peso n the 6 monthforward price was 1 peso = .09 cents e is 1 peso = 7 cents OMPANY IN 2016 AND 2017 ontract on October 2nd