Wolters Corporation is a U.S. corporation that purchased 50,000 chocolate bars from a foreign manufacturer...
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Accounting
Wolters Corporation is a U.S. corporation that purchased 50,000 chocolate bars from a foreign manufacturer on 6/1/X9 for 80,000 foreign currency units, to be paid on 9/1/X9. On 6/1/X9 Wolters also entered into a forward contract to purchase 80,000 foreign currency units on 9/1/X9. Wolters has a July 31 year end.
Exchange rates are as follows:
Date
Spot Rate
Fwd Rate
6/1/X9
$0.64
$0.645
7/31/X9
$0.66
$0.68
9/1/X9
$0.69
$0.69
Discount rate = 12% Required: Make the necessary journal entries for Wolters for the period June 1 through September 1, 20X9.
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