Suppose that home country A has the following recorded transactions with foreign country B. Following...
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Accounting
Suppose that home country A has the following recorded transactions with foreign country B. Following the example below, for each transaction, indicate which item is a debit and which item is a credit (in Country A's the balance of payments) and how the item would be identified in the balance of payments. 4) Example: An importer in country A buys S8,000 of apparel from a country-B supplier, paying for the goods by writing a check to be deposited into the B firm's bank account in a country A bank. Debit S8,000 of imports from country B Credit $8,000 increase in foreign private assets in country A (a) A firm in country A sells $6,000 of steel to a country B firm. Payment is made by the firm in B drawing down its checking account in a country A commercial bank. b) A country A citizens give S1,000-worth of cash to country B relatives by writinga cheque on his bank accounts in country B. (c) A citizen of country B buys a long-term bond of a company in country A. The buyer purchases the S5,000 bond by drawing down his/her checking deposit in a bank in A (d) A firm in country A purchases S3,000 of shipping services from a country B ocean freight carrier, paying for the services by drawing down bank deposits in B owned by the country A firm
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