Question

7a. On July 1, 2017, Alpha Company purchased inventory from its Japanese supply source. Terms of sale were 100,000 yen, due 30 days from the date of purchase.  On July 30, 2017, Alpha paid for the supplies purchased on July 1. The exchange rate for the yen was $0.01 on the date of purchase, and $0.0097 on the date of payment. Use this information to prepare Alpha Company's general journal entries to record the purchase and payment for inventory purchased from its Japanese vendor.

General Journal:

Date	Accounts	Debit	Credit

7b. On January 2, 2016, Alpha Corporation issued 1,500 shares of $6 par value common stock. The issue price was $15 per share. On January 15, Alpha Corporation issued 1,100 shares of its $100 par 5% cumulative preferred stock for $105 per share. Use this information to prepare the General Journal entry (without explanation) for the January 2 and January 15 entries.

Date	Accounts	Debit	Credit
1/2/16
1/15/16

Answer 1

7a. On July 1, 2017, Alpha Company purchased inventory from its Japanese supply source. Terms of sale were 100,000 yen, due 30 days from the date of purchase. On July 30, 2017, Alpha paid for the supplies purchased on July 1. The exchange rate for the yen was $0.01 on the date of purchase, and $0.0097 on the date of payment. Use this information to prepare Alpha Company's general journal entries to record the purchase and payment for inventory purchased from its Japanese vendor General Journal: Date Account Debit Credit July 1, 2017 Purchase a/c... Dr $ 1,000.00 To Trade payable 1,000.00 (being goods purchsed of 100,000 yen [100,000yen 0.01- 1000] $0.01) July 30, 2017 Trade payable Dr $ 1,000.00 To foreign fluctuation gain. a/c 30.00 970.00 To Bank a/c (Beign payment made to vender @0.0097 of 100,000 yen @0.0097, balanced amount trf to foreign fluctuation gain ac/c) Working Note Date July 1, 2017 July 30, 2017 Particular Yen Exchange rate Amount in $ 100,000 100,000 0.01 1,000 970 30 0.0097 Gain/ (loss)