02 October 2015
Please give me answer to following problem. ...
Mr.X bought a forward contract for 3 months of US $200,000 on 1st December 2014 at 1 US $ =44.10 when the exchange rate was 1 US $=43.90. On 31st December 2014, when he closed his books, exchange rate was 1 US $=44.20. On 31st January 2015 he decided to sell the contract at 44.30 per dollar. Show how the profits from the contract will be recognised in the books of Mr.X.
Refer the below example in the given link may be useful http://assets.cacharya.com/Accounting-for-Forward-Exchange-Contracts-under-Accounting-Standard-AS-11-NKCJJY5S.pdf?1425907352
CAclubindia
