What is the amount to be reported by LKLD Company

Assignment Help Financial Accounting

Reference no: EM132796120

Questions -

Question 1 - LKLD Company purchased merchandise for 300,000 pounds from a vendor in London on November 30, 2020. Payment in British pounds was due on January 30, 2021. The exchange rates for the British pound were as follows:

November 30, 2020 December 31, 2020

Spot rate $1.65 $1.62

30-day rate 1.64 1.59

60-day rate 1.63 1.56

In its December 31, 2020 income statement, what is the amount to be reported by LKLD Company as foreign exchange difference?

a. P9,000 gain

b. P3,367 loss

c. P3,367 gain

d. P9,000 loss

Question 2 - On January 2, 2020, Peter Sawyer Inc., acquired building for $100,000 from a company based in Australia. The building estimated useful life is 10 years. Peter Sawyer Inc. uses the straight-line method of depreciation and revaluation model. On December 31, 2020, the building revaluation amount was determined at net appraised value of $120,000. The relevant exchange rates are as follows:

January 1, 2020 $1=P30

December 31, 2020 $1=P32

How much is the gain or loss to be presented in the financial statement on December 31, 2020?

a. P40,000 Forex gain

b. P200,000 Forex gain

c. P1,140,000 Revaluation surplus-OCI

d. P200,000 Revaluation surplus-OCI

Question 3 - On December 1, 2020, Ethel Inc. a Philippine company, purchased inventory worth $100,000 from a US supplier, payable within 30 days. Ethel Inc. issued a 30 day notes payable in US dollar. On December 31, 2020, it paid the note. The following are the relevant exchange rates

Date Buying Selling

December 1, 2020 $.04161 $0.04141

December 31, 2020 $.04149 $0.04129

The foreign exchange gain or loss on the transaction is:

a. P7,000 loss

b. P12 gain

c. P10 gain

d. P5,000 loss

Question 4 - An entity purchases plant from a foreign supplier for 3,000,000 yen on January 2, 2020, when the exchange rate was 2 Yen = P1. At the entity's year end, December 31, 2020, the amount has not been paid. The rate was Yen 1.50= P1. The entity's functional currency is the peso.

What is the cost of the plant that should be reflected in the statement of financial position?

a. P2,000,000

b. P1,500,000

c. P3,000,000

d. P2,500,000

Question 5 - An entity purchases plant from a foreign supplier for 3,000,000 yen on January 2, 2020, when the exchange rate was 2 Yen = P1. At the entity's year end, December 31, 2020, the amount has not been paid. The rate was Yen 1.50= P1. The entity's functional currency is the peso.

What is the foreign exchange gain or (loss) that should be reflected in the statement of comprehensive income?

a. (P0.50 million)

b. P0.50 million

c. (P0.60 million)

d. P0.60 million

Question 6 - An entity purchases plant from a foreign supplier for 3,000,000 yen on January 2, 2020, when the exchange rate was 2 Yen = P1. At the entity's year end, December 31, 2020, the amount has not been paid. The rate was Yen 1.50= P1. The entity's functional currency is the peso. What is the amount of trade payable (liability) that should be reflected in the statement of financial position?

a. P2,000,000

b. P2,500,000

c. P1,500,000

d. P3,000,000

Question 7 - On September 1, 2020, LKLD Co. acquired a computer for $100,000 when the exchange rate is P1= $20. LKLD Co. reported foreign exchange loss of P15,000 in its 2020 financial statement and P10,000 foreign exchange gain in its 2021 financial statements. What is the exchange rate on December 31, 2020?

a. P1= $19.85

b. $1=P20.15

c. $1=P0.20

d. Not given

Question 8 - On September 1, 2020, LKLD Co. acquired a computer for $100,000 when the exchange rate is P1= $20. LKLD Co. reported foreign exchange loss of P15,000 in its 2020 financial statement and P10,000 foreign exchange gain in its 2021 financial statements. What is the amount of computer on December 31, 2020?

a. P2,000,000

b. P2,015,000

c. P5,000

d. P20,000

Question 9 - On September 1, 2020, LKLD Co. acquired a computer for $100,000 when the exchange rate is P1= $20. LKLD Co. reported foreign exchange loss of P15,000 in its 2020 financial statement and P10,000 foreign exchange gain in its 2021 financial statements. What is the exchange rate on the settlement date?

a. P1=$0.10

b. P1=$20.05

c. $1=P20.15

d. P1=$10

Question 10 - On September 1, 2020, LKLD Co. acquired a computer for $100,000 when the exchange rate is P1= $20. LKLD Co. reported foreign exchange loss of P15,000 in its 2020 financial statement and P10,000 foreign exchange gain in its 2021 financial statements. How much is the cost of computer on December 31, 2021 statement of financial position?

a. P10,000

b. P20,000

c. P5,000

d. P2,000,000

Question 11 - On September 1, 2020, LKLD Co. acquired a computer for $100,000 when the exchange rate is P1= $20. LKLD Co. reported foreign exchange loss of P15,000 in its 2020 financial statement and P10,000 foreign exchange gain in its 2021 financial statements. How much is the total accounts payable on December 31, 2020 statement of financial position?

a. P20,000

b. P2,015,000

c. P2,000,000

d. P5,000

Question 12 - Peter purchases raw materials from its foreign supplier, Sawyer, on February 1, 2020. Payment of 4,700,000 foreign currency units (FC) is due in 30 days, June 30, 2020 fiscal year-end. The pertinent exchange rates were as follows:

Date Spot Rate

February 1 P1.25

June 30 P1.26

July 31 P1.20

What amount should Peter's accounts payable be reported at June 30, 2020?

a. P5,875,000

b. P5,922,000

c. P3,730,159

d. P3,760,000

Question 13 - Peter purchases raw materials from its foreign supplier, Sawyer, on February 1, 2020. Payment of 4,700,000 foreign currency units (FC) is due in 30 days, June 30, 2020 fiscal year-end. The pertinent exchange rates were as follows:

Date Spot Rate

February 1 P1.25

June 30 P1.26

July 31 P1.20

What amount should Peter's accounts payable be reported at February 1, 2020?

a. P5,875,000

b. P5,922,000

c. P3,730,159

d. P3,760,000

Question 14 - Peter purchases raw materials from its foreign supplier, Sawyer, on February 1, 2020. Payment of 4,700,000 foreign currency units (FC) is due in 30 days, June 30, 2020 fiscal year-end. The pertinent exchange rates were as follows:

Date Spot Rate

February 1 P1.25

June 30 P1.26

July 31 P1.20

How much foreign exchange gain or loss should Peter record on June 30, 2020?

a. P470 loss

b. P470 gain

c. P47,000 gain

d. P3,760,000

Question 15 - Peter purchases raw materials from its foreign supplier, Sawyer, on February 1, 2020. Payment of 4,700,000 foreign currency units (FC) is due in 30 days, June 30, 2020 fiscal year-end. The pertinent exchange rates were as follows:

Date Spot Rate

February 1 P1.25

June 30 P1.26

July 31 P1.20

How much Philippine peso will its cost Peter to finally pay the accounts payable on July 31, 2020?

a. P5,640,000

b. P5,875,000

c. P5,734,000

d. P5,922,000

Question 16 - Ethel Corporation issued a promissory note denominated in foreign currency for the purchase made from a supplier in England on December 1, for a 60 day, 18% promissory note for 108,000 pounds, at a selling rate of 1 FC to P74.20. On December 31, the selling spot rate is FC to P74.85. On January 30, the selling spot rate is FC to P75.75. On the settlement date, how much is the foreign again or loss?

a. P172,422 gain

b. P100,116 loss

c. P172,422 loss

d. P98,658 loss

Question 17 - Hinghol Co, a Philippine corporation, sold inventory on December 1, 2020, with payment of 32,500 British pounds to be recorded in sixty days. The pertinent exchange rates were as follows:

Date Spot rate

December 1, 2020 P1.7241

December 31, 2020 P1.8182

January 30, 2021 P1.6666

For what amount should Sales be credited on December 1, 2020?

a. P18,850

b. P17,875

c. P59,091.50

d. P56,033.25

Question 18 - Hinghol Co, a Philippine corporation, sold inventory on December 1, 2020, with payment of 32,500 British pounds to be recorded in sixty days. The pertinent exchange rates were as follows:

Date Spot rate

December 1, 2020 P1.7241

December 31, 2020 P1.8182

January 30, 2021 P1.6666

For what amount of foreign exchange gain or loss should be recorded on December31, 2020?

a. P975 loss

b. P975 gain

c. P3.058.25 gain

d. P3,058.25 loss

Question 19 - Hinghol Co, a Philippine corporation, sold inventory on December 1, 2020, with payment of 32,500 British pounds to be recorded in sixty days. The pertinent exchange rates were as follows:

Date Spot rate

December 1, 2020 P1.7241

December 31, 2020 P1.8182

January 30, 2021 P1.6666

For what amount of foreign exchange gain or loss should be recorded on January 30, 2021?

a. P1,625 loss

b. P1,625 gain

c. P4,927 gain

d. P4,927 loss

Question 20 - An entity acquired all the share capital of a foreign entity at a consideration of 18 million yen on June 30, 2020. The fair value of the net assets of the foreign entity at that date was 12 million yen. The functional currency of the entity is the peso. The financial year end of the entity is December 31, 2020. The exchange rate at June 30, 2020 and December 31, 2020, were 1.5 yen = P1 and 2 yen = P1, respectively. What amount of goodwill should be included in the financial statement for the year ended December 31, 2020?

a. P3,000,000

b. 6,000,000 yen

c. P4,000,000

d. P6,000,000

Reference no: EM132796120

Questions Cloud

Prepare the journal entry required at declaration : The common shares have a fair value of $450 per share on December 31, 2020, the date of declaration. Prepare the journal entry required at declaration.

What is the return on sales for the division : The following are selected data for the division for the consumer products of ABC Corp for 2019: What is the return on sales for the division

What the journal entry would include a credit to : NCT Corporation issued 1,000 ordinary shares, The ordinary share has 100 par value per share. In recording the sale, the journal entry would include a credit to

How much will be the new total amount of shareholders equity : How much will be the new total amount of Shareholders' Equity if the subscription receivable are declared delinquent and absorbed as Treasury Shares?

What is the amount to be reported by LKLD Company : In its December 31, 2020 income statement, what is the amount to be reported by LKLD Company as foreign exchange difference

Describe the submicroscopic events : Acetone, CH3COCH3, is a laboratory solvent that is also commonly used as a nail polish remover.

What was effect on net income of entering into derivative : Titanium Ltd, What was the effect on net income of entering into this derivative transaction for the period from January 1 to June 30, 2021?

Maximum amount of potassium sulfate : For the following reaction, 57.4potassium hydrogen sulfate22.2potassium hydroxidepotassium hydrogen sulfate grams of are allowed to react with grams of (aq) + p

How much of proceeds would be allocated to ordinary shares : How much of the proceeds would be allocated to the ordinary shares? 10,000 shares of its $5 par value ordinary shares having a fair value of $25 per share

User Account

All Pages