XYZ Company purchased inventory on November 15, 2020 from a foreign supplier for 600,000 units of foreign currency (FC) due on January 15, 2021. Simultaneously, XYZ entered into a forward contract to buy 600,000 units of FC on January 15, 2021 at the forward rate of $.52. XYZ received the Inventory and paid the foreign supplier on January 15, 2021. XYZ ends its fiscal year on December 31.

The following exchange rates were quoted:

		Forward Rate
Date	Spot Rate	(Delivery on 1/15/2021)
11/15/2020	0.55	0.58
12/31/2020	0.52	0.51
1/15/2021	0.53

(Reminder: To avoid confusion as explained in class, only use the following accounts to make journal entries for foreign currency transactions: Inventory, Sales, Cash, Machine, Equipment, A/Payable (FC), A/Receivable (FC), Exchange G/L, Fwd Contract, Contract G/L, Contract G/L-OCI, Firm Commitment, Commitment G/L, Option, Option G/L, Option G/L-OCI.)

Required:

A. Prepare all journal entries relative to the above event on November 15, 2020. Buy/Sell Account Dr. Account Cr.

B. Prepare all journal entries relative to the above event on December 31, 2020.

Buy/Sell Account Dr. Account Cr.

Financing Account Dr. Account Cr.

C. Prepare all journal entries relative to the above event on January 15, 2021.

Buy/Sell Account Dr. Account Cr.

Account Dr. Account Cr.

Financing Account Dr. Account Cr.

Account Dr. Account Cr.