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Exercise 1 - FC Transaction

Exercise 1 - Foreign Currency Transaction - Selling
2ManyMice Co., a domestic wholesaler who prepares monthly financial statement in U.S.$, sold merchandise
to a British customer, with the transaction to be denominated in British Pounds (£). Relevant information and
spot rates for this transaction are as follows:
Sold £ 200,000 of merchandise with a cost of $75,000 on July 1, 2017 payable in full September 10th, 2017.
Spot Rates
July 1st, 2017 1 £ = $1.45 August 31st, 2017 1 £ = $1.38 Sept. 30th 2017 1 £ = $1.47
July 31st, 2017 1 £ = $1.35 Sept. 10th, 2017 1 £ = $1.42 December 31st 2017 1 £ = $1.43
Prepare the journal entries required on the books of 2ManyMice Co. to account for this transaction by selecting the proper date and accounts for each entry using the drop down menus in the gray cells, and entering the proper debit / credit amounts in the gray cells. When correct, cells will change colors. 7/1/17 Accounts Receivable
7/31/17 Cash
Date Account Debit Credit 8/31/17 Cost of Goods Sold
9/10/17 Foreign Exchange Gain
9/30/17 Foreign Exchange Loss
12/31/17 Inventory
Sales

Exercise 2 - FC Transaction

Exercise 2 - Foreign Currency Transaction - Buying
ACME Machinery Co., a domestic manufacturer who prepares monthly financial statement in U.S.$, purchased
component parts from a European supplier, with the transaction to be denominated in Euros. Relevant information
and spot rates for this transaction are as follows:
Purchased € 750,000 of component parts on January 1, 2017 payable in full April 15th, 2017.
Spot Rates
January 1st, 2017 1 € = $1.05 February 28th, 2017 1 € = $1.15 April 15th, 2017 1 € = $1.02
January 31st, 2017 1 € = $1.10 March 31st, 2017 1 € = $1.08 April 30th, 2017 1 € = $1.04
Required: Prepare the journal entries required on the books of ACME Machinery Co. to account for this transaction.
Date Account Debit Credit
1/1/17 Accounts Payable
1/31/17 Cash
2/28/17 Foreign Exchange Gain
3/31/17 Foreign Exchange Loss
4/15/17 Inventory
4/30/17

Exercise 3 - FC Translation

Exercise 3 - Foreign Currency Translation
OhMyNose Inc. is the 100% owner of a European based subsidiary, BlackEye Inc. BlackEye Inc. was
acquired by OhMyNose Inc. on January 1, 2016. Information regarding this acquisition is as follows:
Relevant information regarding the books of BlackEye Inc.:
Capital Stock January 1st, 2016 € 150,000
Retained Earnings January 1st, 2016 € 200,000
2016 Net Income € 150,000
Selected exchange rate information is as follows:
January 1st, 2016 Spot Rate 1 € = $1.35 January 1st, 2017 Spot Rate 1 € = $1.24
Full-Year 2016 Average Rate 1 € = $1.28 Full-Year 2017 Average Rate 1 € = $1.18
December 31st, 2016 Spot Rate 1 € = $1.25 December 31st, 2017 Spot Rate 1 € = $1.12
Required: Given the following 12/31/2017 trial balance of BlackEye Inc., calculate the translated trial balance and the accumulated translation adjustment by selecting the proper conversion rate for each item in the gray shaded cells using the drop down menu, and then calculate the U.S. $ amount and enter into the gray shaded cells on the right. When correct, the cells will change color. Note: Do not copy formulas down in the U.S. $ Trial Balance column as doing so will overwrite the "change color when right" formatting).
Account Trial Balance in Euros Rate to Convert At U.S. $ Trial Balance
Cash € 200,000 1.12
Accounts Receivable € 150,000 1.18
Inventory € 300,000 1.24
Land € 25,000 1.25
Building (net) € 300,000 1.28
Equipment (net) € 250,000 1.35
Patent € 100,000 N/A
Accounts Payable (€ 250,000)
Notes Payable (€ 400,000)
Capital Stock (€ 150,000)
Retained Earnings (€ 200,000)
Sales (€ 750,000)
Cost of Goods Sold € 300,000
Other Expenses € 125,000
Accumulated Translation Adj.
Total € 0 $0

Exercise 4 - Rodgers CPA Quiz

Exercise 4: Rodgers CPA Review "Interactive Practice Quiz"
As part of your registration for this course, each student is given access to the Rodgers CPA Review website, a great resource for both lecture material and review / expectation of the actual CPA exam. For our course, we're going to be utilizing Rodgers' "Interactive Practice Quizzes". The "Interactive Practice Quizzes" are a great resource for developing an understanding of the material at hand - they are not intended to be assessments. When taking an "Interactive Practice Quiz" you have the ability to draw from resources on the website to develop an understanding of the material in order to answer the questions.
In certain sections of our class, you're going to be asked to answer the multiple choice questions within specific sections of Rodgers CPA Review "Interactive Practice Quizzes". Below will be specific instructions on which area to work on, and what you need to complete and post up on this page to demonstrate your participation in these activities.
In week #5 of this class we'll be covering segment reporting and foreign currency transactions & translations, which align to the FAR 21 and FAR 6 sections in Rodgers CPA Review, respectively. There are "Interactive Practice Quizzes" for FAR 21 and FAR 6 which contains approximately 30 questions each. For week #5, you'll be working through these "Interactive Practice Quizzes".
For week #5, you will be required to have attempted at least 20 questions in each of the FAR practice quizzes of the multiple choice questions in the FAR 21 Segments and FAR 6 Foreign Operations "Interactive Practice Quizzes" and successfully answer at least 15 in each one (more are always welcome!).
To complete this week's requirement, attempt at least 20 questions in each FAR with at least 15 correct responses each, and then take screen shots of your completion summaries for each section. Insert the screen shots below and simply submit with this file when uploaded this completed homework assignment.