Example 4: G/L Postings that Occur from the Payment 
Example 4: G/L Postings that Occur from the Payment
Below you will find the G/L postings that result after payment is made to the vendor.
Europe |
Remember that the invoice as originally posted with an exchange rate of 3.00. It was revaluated at the end of the period at a rate of 2.97. The assumption is that the invoice is paid before the end of the second period - so it was not revalued a second time. At the time of payment, the exchange rate has dropped to 2.95. |
North America |
Remember that the invoice as originally posted with an exchange rate of 0.7. It was revaluated at the end of the period at a rate of 0.67 with different results for revaluation methods I and II. The assumption is that the invoice is paid before the end of the second period - so it was not revalued a second time. At the time of payment, the exchange rate has dropped to 0.66. |
|
US Example - Payment - After revaluation Method I: |
US Example - Payment - After revaluation Method II: |
In British Pound |
In Canadian Dollars |
In Canadian Dollars |
Credit 113101 Deutsche Bank Account (Check) 1500 |
Credit 113101 Citibank Account (Cash) 1000 |
Credit 113101 Citibank Account (Cash) 1000 |
Debit 1098 Leeds Manufacturing (Vendor) 1500 |
Debit 4910 D&P Forbes (Vendor) 1000 |
Debit 4910 R & P Bros (Vendor) 1000 |
In DEM |
In USD |
In USD |
Credit 113101 Deutsche Bank (Check) 4425 |
Credit 113101 Citibank Account (Cash) 660 |
Credit 113101 Citibank Account (Cash) 660 |
Debit 1098 Leeds Manufacturing (Vendor) 4500 |
Debit 4910 D & P Forbes (Vendor) 700 |
Debit 4940 R & P Bros (Vendor) 700 |
Credit 161099 Trade Payables - foreign adjustment account 45 |
Credit 161099 Trade Payables - foreign adjustment account 6.67 |
Credit 280000 Foreign Currency Revaluation Gains 40 |
Credit 280010 Foreign Currency Revaluation Gains 30 |
Credit 280010 Foreign Currency Revaluation Gains 33.33 |