Assignment Question(s): (10.0 Marks)1.On October 1, 2021, a manufacturing company in Egypt imported raw materials of 100,000 $ from the United States by letter of credit and it will pay for the raw materials after 6 months against promissory note. (4.0 marks)Exchange rates of Egyptian pound against us $ were as follows:October 1, 2021 15.70 December 31, 2021 15, 60March 31, 2022 18.5Required:a. Pass journal entries to record purchasing raw materials.b. Pass journal entries to record the impact of change in exchange rates at the end of the year.c. journal entries to record payment of liabilities on March 31, 2022.2. On January 1, 2021 a parent company based in US acquired a subsidiary in Egypt and the following information is extracted from the subsidiary’ books for 2021 🙁 3.0 marks)
Inventory purchased on Oct. 1 2021.Purchases of inventory have been made throughout the year.Uses straight-line depreciation on fixed assets.Dividends declared and paid on December 1, 2021Fixed assets have been purchased on Feb. 1 2021.Adjusted trail balance as of 31/12/2021 as follows: Account titleAmount in Egyptian pound Cash2,000,000Accounts receivable2,000,000Inventory5,000,000Notes receivable1,000,000Plant assets10,000,000dividends200,000Cost of goods sold7,000,000Depreciation expense200,000Other expenses500,000Total debits 25,900,000Sales10,000,000Accumulated depreciation200,000Accounts payable3,000,000Notes payable1,000,000Common stocks9,600,000Retained earnings2,100,000Total credits 25,900,000 Exchange rates:DateExchange ratesJanuary 1, 202115.50Oct. 1 202115,60December 1, 202116,50Feb. 1 202117.00December 31, 202117,20Average16.36Required:Prepare a schedule to translate Subsidiary’s financial statements on 31/12/2021 to U.S. dollars using current rate method.3. The partnership of Ibrahim and Rawan have the following provisions: (3.0 marks)- Ibrahim and Rawan receive yearly salary allowances of SAR 30,000 and SAR 20,000, respectively.-Interest is rate of 6 % on the average capital investment.-Any remaining profit or loss is shared between Ibrahim and Rawan at a ratio of 2:1 ratio, respectively.-Average Capital investments: Ibrahim SAR 100,000; Rawan, 50,000Required:a.Prepare a schedule showing the distribution of the profit between the two partners assuming the partnership profit SAR 200,000.b.Pass journal entries to allocate the profit to the partners.
User generated content is uploaded by users for the purposes of learning and should be used following Studypool’s honor code & terms of service.
Reviews, comments, and love from our customers and community: