Business, 20.09.2020 16:01 PrestonTB

On November 12, Higgins, Inc., a U. S. Company, sold merchandise on credit to Kagome of Japan at a price of 1,500,000 yen. The exchange rate was $0.00837 per yen on the date of sale. On December 31, when Higgins prepared its financial statements, the exchange rate was $0.00843. Kagome paid in full on January 12, when the exchange rate was $0.00861. On December 31, Higgins should prepare the following journal entry: a. Debit Sales $90; credit Foreign Exchange Gain $90.
b. Debit Foreign Exchange Loss $90; credit Sales $90.
c. Debit Accounts Receivable-Kagome $90; credit Foreign Exchange Gain $90.
d. Debit Foreign Exchange Loss $90; Accounts Receivable-Kagome $90.
e. No journal entry is required until the amount is collected.

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On November 12, Higgins, Inc., a U. S. Company, sold merchandise on credit to Kagome of Japan at a p...

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