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Anika [276]
3 years ago
6

California Surf Clothing Company issues 1,000 shares of $1 par value common stock at $35 per share. Later in the year, the compa

ny decides to purchase 100 shares at a cost of $38 per share. Record the purchase of treasury stock.
Business
1 answer:
erica [24]3 years ago
5 0

Answer:

Dr Treasury Stock 3,800

Cr Cash 3,800

Explanation:

Preparation of the journal entry to Record the purchase of treasury stock.

Based on the information given we were told that the Clothing Company issues 1,000 shares which means that if the company made decision to purchase 100 shares at the amount of $38 per share later in the year the journal entry to Record the purchase of treasury stock will be :

Dr Treasury Stock 3,800

Cr Cash 3,800

(100 Shares x $38.00 per share)

(Being to record the purchase of treasury stock)

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Your firm (an Australian firm) makes a sale to a Japanese customer.  The sale price is 200 million Japanese Yen payable in exact
charle [14.2K]

Answer:

An Australian Firm Selling to a Japanese Customer

a) Direct Quote of the Exchange Rate between Australian Dollar and Japanese Yen:

A$ 1 = ¥90

Meaning 1 Australian Dollar = 90 Japanese Yen.

Therefore, the price of the goods would be A$ 2,222,222.22222 (¥200 million)/ ¥90

b)Theoretical Current Forward Exchange Rate, quoted in terms of JPY/AUD for delivery in three months:

= Spot Rate x (1 + Japanese Interest Rate) / (1 + Australian Interest Rate) x 360/90

= ¥90 x (1 +0.005) / (1 +0.03) x 360/90 = ¥90 x 1.005/1.03 x 360/90

= ¥351.26214 =A$1

c) The Australian firm can take advantage of any decreases in the exchange rate and also ensure that it receives at least Australian $2 million by entering into a Currency Forwards Contract.

d) If the spot exchange rate in 3 month's time is:

(i) AUD/JPY=150, the outcome of the hedging with a Currency Forwards Contract to get at least A$ 2 million would be the gain of:

Forward Exchange outcome in Australian Dollars = ¥200 million/ ¥150 =

A$ 1,333,333.33333

Hedging outcome minus Forward Exchange outcome

A$2 million - A$ 1,333,333.33333 = A$666,666.66667

(ii) AUD/JPY = 50, the outcome of the hedging with a Currency Forwards Contract to get at least A$ 2 million would be the loss of:

Forward  Exchange outcome =  in Australian Dollars = ¥200 million/ ¥50 =

A$4 million

Hedging outcome minus Forward Exchange outcome

A$2 million - $4 million = -A$2million

Explanation:

a) Currency forwards contracts and future contracts are used to hedge the currency risk. For example, a company expecting to receive  ¥200 million in 90 days, can enter into a forward contract to deliver the  ¥200 million and receive equivalent Australian dollars in 90 days at an exchange rate specified today.

b) If A$ 1 = ¥90

Therefore, the price of the goods would be A$ 2,222,222.22222 (¥200 million)/ ¥90 in Australian Dollars.

5 0
3 years ago
Match each stage of the business life cycle to its corresponding description.
slega [8]

The business life cycle corresponds to the stages that a business goes through throughout its existence in the market, which are existence, survival of the fittest, success, take-off and maturity. The correct sequence for this question is C B D A E.

<h3>Maturity</h3>

The business is separate from the owner with responsibilities delegated to staff. A business in this stage usually commands a considerable share of the market and may even be a household name.

<h3>Takeoff</h3>

Expansion strategies are implemented, and investment is balanced with potential.

<h3>Existence</h3>

The business introduces itself to the market and attempts to catch the attention of potential customers.

<h3>Success</h3>

Company is stable and profitable.

<h3>Survival of the Fittest</h3>

Focus shifts to revenue, expenses, and growth. Cashflow is the major issue.

Therefore, the business life cycle will help management to manage its resources according to the business phase and make more effective decisions for competitiveness and organizational positioning.

The correct answer is:

C. Maturity

B. Takeoff

D. Existence

A. Success

E. Survival of the Fittest

Find out more information about  business life cycle here:

brainly.com/question/25754149

8 0
2 years ago
For a recent year, Best Buy reported sales of $42,410 million. Its gross profit was $9,690 million. What was the amount of Best
LiRa [457]

Answer:

The amount of Best Buy's cost of goods sold was $32,720 million

Explanation:

cost of goods sold = sales - gross profit

                               = $42,410 million - $9,690 million

                               = $32,720 million

Therefore, The amount of Best Buy's cost of goods sold was $32,720 million

6 0
3 years ago
When entering a transaction into a general journal, the entry would be dated; then the accounts_________ would be listed first;
Diano4ka-milaya [45]

Answer: The accounts DEBITS are listed first then the accounts CREDITS would be listed next.

Explanation: In preparing a journal entry, the journal entry date is first stated. This is followed by all accounts DEBITS and the accounts CREDITS are listed next.

The sum of the debits on the journal entry must equate the total sum of the credits. This will help to balance the trial balance.

7 0
2 years ago
Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two
Ostrovityanka [42]

Answer

The answer and procedures of the exercise are attached in the following image.

Explanation  

Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.  

7 0
2 years ago
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