roland brothers inc purchased equipment from a british firm for 120 000 on april 1 2 4373821

Roland Brothers, Inc. purchased equipment from a British firm for £120,000 on April 1, 2008. To finance the purchase of the equipment, the president of the company signed a note for £120,000 with a British bank. The loan is denominated in pounds, matures on March 31, 2009, and bears interest at 12% per annum payable on June 30, September 30, December 31, and March 31. Spot rates for the British pound are as follows:April 1, 2008……… $1.574June 30, 2008……… 1.560September 30, 2008…. 1.526December 31, 2008….. 1.498March 31, 2009…… 1.538Required:Prepare journal entries to record the purchase of the equipment, the interest payments, the adjustment of the accounts on December 31 (the fiscal year-end), and the payment of the note at maturity.View Solution:
Roland Brothers Inc purchased equipment from a British firm for

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