Question

Exercise 12-6 Agentel Corporation is a U.S.-based importing-exporting company. The company entered into the following transactions during the month of November. Nov. 6 Purchased merchandise from AGT, a Swiss firm, for 590,000 francs. 5 Sold merchandise to SLS, Inc., a firm located in Rio De Janeiro, for $190,000. 18 Sold merchandise to TNT, Ltd., a British firm, for 140,000 pounds. 20 Purchased merchandise from SDS, Ltd., a British firm, for $140,000. All the transactions were unsettled at December 31, Agentel’s fiscal year-end. Spot rates are as follows: Currency Date Franc Real Pound November 6 $0.490 $0.412 $1.520 November 15 0.487 0.409 1.509 November 18 0.476 0.414 1.506 November 20 0.468 0.405 1.498 December 31 0.460 0.398 1.482

(a) Compute the amount that Agentel would report for each unsettled receivable and payable in its balance sheet prepared at December 31. Amount Accounts Receivable     SLS, Inc. (denominated in $) $     TNT, Ltd. Accounts Payable     AGT     SDS, Ltd. (denominated in $) $

Answer 1

a)
	Amount
Accounts Receivable:
SLS, Inc. (denominated in $) (already given in dollars)	$190,000
TNT. Ltd. (140,000 pounds * $1.506)	$210,840
Accounts Payable:
AGT (590,000 francs * $0.490)	$289,100
SDS, Ltd. (denominated in $) (already given in dollars)	$140,000