On December 1, 2007, Crane Corporation agreed to purchase a machine to be manufactured by a company in Germany. The purchase price as 1,200,000…

On December 1, 2007, Crane Corporation agreed to purchase a machine to be manufactured by a company in Germany. The purchase price as 1,200,000 German marks. To hedge against fluctuations in the exchange rate, Crane entered into a forward contract on December 1 to buy 1,200,000 marks on April 1, the agreed date of machine delivery, for $.475 per mark. The following exchange rates were quoted:Forward RateDateSpot Rate(Delivery on 4/1)December 1.490.475December 31.470.473April 1.485–Required:Prepare journal entries necessary for Crane during 2007 and 2008 to account for the transactions described above.
.button {
background-color: #4CAF50;
border: none;
color: white;
padding: 10px 20px;
text-align: center;
text-decoration: none;
display: inline-block;
font-size: 16px;
margin: 4px 2px;
cursor: pointer;
border-radius: 10px;
}

“Are you looking for this answer? We can Help click Order Now”