Question & Answer: On March 1, Friedle Import-Export Company sells merchandise costing 75,000 Mexican pesos. Payment wil…..

On March 1, Friedle Import-Export Company sells merchandise costing 75,000 Mexican pesos. Payment will be made in pesos, on June 1. The exchange rates of pesos for $1 were as follows:

March 1 $1 = 10.9 pesos
June 1 $1 = 11.4 pesos

Round all answers to the nearest dollar.

Don't use plagiarized sources. Get Your Custom Essay on
Question & Answer: On March 1, Friedle Import-Export Company sells merchandise costing 75,000 Mexican pesos. Payment wil…..
GET AN ESSAY WRITTEN FOR YOU FROM AS LOW AS $13/PAGE
Order Essay

Required:

1. What is the receivable in dollars on March 1? $

2. What is the dollar value of the amount paid in pesos on June 1? $

3. If Friedle is paid on June 1, is there an exchange gain or loss?                 How much was it?

Expert Answer

 

1) Receivable in dollars on March 1 = 75000/10.9 = $         6,881
2) Dollar value of amount paid in Pesos on June 1 = 75000/11.4 = $         6,579
3) Yes, there is an exchange loss. It is $6881-$6579 = $             302

Still stressed from student homework?
Get quality assistance from academic writers!