Problem

Assume that on May 1, Zavior Corporation (a U.S. company) sells goods to a Portuguese corp...

Assume that on May 1, Zavior Corporation (a U.S. company) sells goods to a Portuguese corporation at a price of 100,000 euros, with payment due within three months At the date of the sale, the exchange rate is $ 1.20 per euro. The Portuguese customer waits until the three months have passed and pays for the purchase on July 31, when the exchange rate is $1.18 per euro. What is the gain or loss on the transaction for Zavior? Show the journal entries that Zavior would record on May 1 and on July 31.

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