Chapter 17

CHAPTER 17
SUGGESTED ANSWERS

Exercise 17 - 1

Jan.
5
Purchases
1,789,200

Accounts Payable

1,789,200

70,000 x P25.56

Mar.
9
Purchases
16,780

Accounts Payable

16,780

100,000 x P.1678

May
10
Accounts Payable
1,789,200

Foreign Exchange Gain or Loss
2,800

Cash

1,792,000

70,000 x P25.60 = P1,792,000

16
Accounts Payable
16,780

Foreign Exchange Gain or Loss

1,280

Cash

15,500

100,000 x P.1550

Exercise 17 -2

Mar.
14
Merchandise Inventory
1,057,000

Accounts Payable

1,057,000

20,000 x P52.85

Apr.
10
Merchandise Inventory
45,822

Accounts Payable

45,882

60,000 x P.7637

14
Accounts Payable
1,057,000

Foreign Exchange Gain or Loss

2,000

Cash

1,055,000

20,000 x P52.75

May
10
Accounts Payable
45,822

Foreign Exchange Gain or Loss
2,928

Cash

48,750

60,000 x P.8125

Exercise 17 - 3

May
22
Accounts Receivable
54,085

Sales

54,085

10,000 x P5.4085

31
Accounts Receivable
8,516

Sales

8,516

40,000 x P.2129

June
22
Cash
55,015

Foreign Exchange Gain or Loss

930

Accounts Receivable

54,085

10,000 x P5.5015 = P55,015

30
Cash
8,540

Foreign Exchange Gain or Loss

24

Accounts Receivable

8,516

Exercise 17 -4

Jack Company
Income Statement
For the Year Ended December 31, 2006

Italian
Translation
Philippine

Lira
Rate
Peso
Sales
300,000
.51168
153,504
Cost of goods sold 200,000
.51168
102,336
Gross profit 100,000

51,168
Operating expenses 55,000
.51168
28,142
Net income 45,000

23,026 Bell Company
Balance Sheet
December 31, 2006
Assets

Italian
Translation
Philippine

Lira
Rate
Peso
Cash
9,500
.51278
4,872