Advanced financial accounting PowerPoint presentation. In this presentation, we will discuss foreign currency transactions get ready to account with advanced financial accounting, foreign currency transactions. So remember when we’re thinking about foreign currency transactions, we’re thinking about them from the perspective of the US company in US dollar. So we’re have our currency that we’re making our financial statements in, we’re measuring all the stuff on our financial statements with the measuring tool that we need to be using, that’s going to be the US dollar, that’s going to be our standardization. And then anytime we have foreign currency transactions with something other than US dollars, then we want to see them from that perspective, right? Because when we put them on our financial statements, just like anything else, just like inventory, if we were to value units of inventory, or to value stocks and whatnot, we need to value them in terms of our measure into a which of course is the US dollar.
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Forward Exchange Contracts
Advanced financial accounting a PowerPoint presentation. In this presentation, we will discuss forward exchange contracts get ready to account with advanced financial accounting, forward exchange contracts. Now we’re going to go over some of the components of the foreign exchange contracts here, we’ll go into them on a lot more detail as we work through practice problems related to the forward exchange contracts. But just to visualize the basic kind of layout of a foreign exchange contract as you think about these items, and there’ll be a lot more concrete once we look at practice problems, we’re basically have a setup where we’re going to be working with a bank or a dealer, typically a bank, and we’re going to be setting up a foreign exchange contract which is basically going to say, we have a receivable and payable on the books at this point in time and we’re either going to put the receivable or the payable that is going to be due to us or something that we will pay in foreign currency at the end of the time period. Whereas the other side the receivable or the payable, the other side that’s not in foreign currency will be in US dollars. In other words, we We will determine the amount that will that we’re talking about. And then we’ll use an exchange rate which we’ll talk a little bit more about the exchange rate that we will use to value it in today’s dollars will put either the receivable or the payable in US dollars and either the receivable or the payable and foreign dollars as of this point in time. And then as time changes, as the rate of the foreign currency changes, then that could result in the difference between, you know, what we thought the value would be, at the point in time we went into the forward contract between the US dollar and the foreign currency as that difference changes over time that could result in basically a gain or loss.