On August 1, Central Computers, Inc

question 57

Multiple Choice

On August 1, Central Computers, Inc. purchased thirty computer chips, on account, from a company located in Taiwan for 500,000 Taiwan dollars. On that date the Taiwan dollar is worth $0.040. On September 1, when the Taiwan dollar was worth $0.038, payment was made. The journal entry to record the payment on September 1 would include a:

• A) debit to Accounts Payable $19,000.
• B) debit to Foreign-Currency Transaction Loss $1,000.
• C) credit to Foreign-Currency Transaction Gain $1,000.
• D) credit to Cash $20,000.

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Definitions:

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Sociohistorical Context

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