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On May 8, 2019, Jett Company (a U.S. company) made a credit sale to Lopez (a...

On May 8, 2019, Jett Company (a U.S. company) made a credit sale to Lopez (a Mexican company). The terms of the sale required Lopez to pay 700,000 pesos on February 10, 2020. Jett prepares quarterly financial statements on March 31, June 30, September 30, and December 31. The exchange rates for pesos during the time the receivable is outstanding follow.

May 8, 2019 $ 0.1977
June 30, 2019 0.1986
September 30, 2019 0.1997
December 31, 2019 0.1980
February 10, 2020 0.2019


Compute the foreign exchange gain or loss that Jett should report on each of its quarterly income statements for the last three quarters of 2019 and the first quarter of 2020.
Compute the amount reported on Jett's balance sheets at the end of each of its last three quarters of 2019.


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Answer #1

Answer with working is given below

Exchange gain or loss is recognized for each quarter and Debtors is reported at Quarter end rate

Gain/(Loss) $630 Gain a) Year Quarter June Quarter 2019 $770 Gain -$1,190 Loss $2,730 Gain September Quarter December Quarter

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