Case 4A
First Goods Imported, then Payment Made
Goods imported $ 1000 from Max Ltd,USA.
| Date | Descripton |
Exchange
Rate/$ |
| 10-Feb | Booking of Order | 60/$ |
| 14-Feb | Date of Goods Entering India | 61/$ |
| 15-Feb | Rate as per Bill of Entry | 62/$ |
| 16-Feb |
Date of Goods Entering
Factory |
63/$ |
Payment not made till Balance Sheet date 31 March
View answer
16-Feb
PUR DR 62000
TO MAX LTD USA 62000
31-Mar
FOREIGN EXCH. FLUCTUATION DR 4250
TO MAX LTD USA 4250
(We have to take exchange rate as on 31 March from Google
Suppose it is 66.25
Exchange fluctuation
=66.25*1000-62*1000
=66250-62000
=4250)
Case 4B
Suppose payment actually made on 5 April when the exchange rate was Rs 64/$
View answer
16-Feb
PUR DR 62000
TO MAX LTD USA 62000
31-Mar
FOREIGN EXCH. FLUCTUATION DR 4250
TO MAX LTD USA 4250
05-Apr
MAX LTD USA DR 64000
TO BANK 64000
05-Apr
MAX LTD USA DR 2250
TO FOREIGN EXCH. FLUCTUATION 2250
(66250-64000)