A company in Dar es Salaam purchases machinery from South African company for Rand 120,000...
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Accounting
A company in Dar es Salaam purchases machinery from South African company for Rand 120,000 and receives no trade credit . The machinery is transported to Dar es Salaam by a Zambian trucking company that charges the Tanzanian company 5,000,000 Kch . The Dar es Salaam Company insures the shipment with a US subsidiary located in Dar es Salaam and pays a premium of USD 1000. The subsidiary's policy is to remit 60% of its cash inflows to US annually . After delivering the machinery to Dar es Salaam the Zambian truck continues its trip to Arusha , where it picks up flowers sold by Arusha company to a Kenyan company . This shipment , which is worth Kshs . 2,000,000 is insured by Alliance ( a Swiss insurance company ) for a premium of SFr 2,500 .
The following additional information may be relevant. Exchange rates 200 Tshs/Rand 1250 Tshs /USD 20 Kch /Tshs 1200 Tshs / SF 18 Tshs/ Kshs
In the 2020, 75% of the US subsidiary's cash flows are allowed to be remitted , the rest are blocked.
With relevant assumptions , prepare the 2020 BOP account for Tanzania.
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