Question

Recording Import and Export Transactions

Walsh Corporation imports raw materials from other countries and exports finished goods to customers throughout the world. Information regarding four such transactions occurring in the last accounting period, all denominated in units of foreign currency, is given below:

Country	Amount	Spot Rate at Transaction Date	Spot Rate at Payment Date
1. Import from Taiwan	110,000 Taiwan dollars	$0.033	$0.038
2. Import from Poland	620,000 zloty	0.300	0.285
3. Export to Brazil	500,000 real	0.296	0.263
4. Export to Switzerland	830,000 Swiss francs	0.750	0.786

Prepare the journal entries made by Walsh to record the above events on the transaction date and on the payment date.

Import Transaction 1

General Journal Description Debit Transaction date: Credit Payment date: Exchange loss

Import Transaction 2

Export Transaction 3

Export Transaction 4

Account titles from drop down to choose from (FOR IMPORT Transactions): Inventory, Cash, Exchange Gain, Accounts Payable

Account titles from drop down to choose from (FOR EXPORT Transactions): Cash, Sales, Accounts Receivable, Inventory, Exchange Gain

Please use the provided information to complete both import and export tables. Show all work. Thank you!!!

Answer 1

	Import Transaction 1
	Description	Debit	credit
	Transaction date
	Purchase	$3,630		(110000*0.033)
	Accounts Payable		$3,630
	Payment Date
	Accounts Payable	$3,630
	Exchange Loss	$550		(4180-3630)
	Cash		$4,180	(110000*0.038)
	Import Transaction 2
	Description	Debit	credit
	Transaction date
	Purchase	$186,000		(620000*0.300)
	Accounts Payable		$186,000
	Payment Date
	Accounts Payable	$186,000
	Exchange Gain		$9,300	(186000-176700)
	Cash		$176,700	(620000*0.285)
	Export Transaction3
	Description	Debit	credit
	Transaction date
	Accounts Receivable	$148,000		(500000*0.296)
	Sales		$148,000
	Payment date
	Cash	$131,500		(500000*0.263)
	Exchange Loss	$16,500		(148000-131500)
	Accounts Receivable		$148,000
	Export Transaction4
	Description	Debit	credit
	Transaction date
	Accounts Receivable	$622,500		(830000*0.750)
	Sales		$622,500
	Payment date
	Cash	$652,380		(830000*0.786)
	Exchange Gain		$29,880	(652380-622500)
	Accounts Receivable		$622,500
		Import	Export
	Dollar Weakens	Exchange Loss	Exchange Gain
	Dollar Strengthen	Exchange Gain	Exchange Loss