Question

Pass necessary Journal Entries in the books of 'N' of Nashik based on AS 11 from the following transactions :
A machine was imported on 20th January, 2018 from Van. Chan of China for US $ 2,00,000. The payment for the same was made as follows :
US $ 1,50,000 on 27th February 2018.

US $ 50,000 on 15th March 2018.

The Exchange Rate for $ 1 Was as follows :

On 20th January, 2018 Rs. 65.60

On  27th February, 2018. Rs. 66.50

On 15th March, 2018 Rs.66.80

N follows financial year as accounting year. 

Answer 1

Books of N
Journal

Date	Particulars	Dr.	Cr.
20.1.18	Machinery A/c                Dr	1,31,20,000
	To Van Chan A/c		1,31,20,000
	(Being purchased of machinery, $ 2·00 000 @ 65.60)
27.2.18	Van Chan A/c                 Dr	1,01,10,000
	To Bank A/c		99,75,000
	To Exchange Difference A/c		1,35,000
	(Being amount paid $ l,50,000 @ 66.50 and FE Loss adjusted $ 1,50~000 (66.50- 65.60)
15.3.18	Van Chan A/c (50,000 x 65.60)                            Dr.	32,80,000
	Exchange Difference A/c (50,000 x 1.20)              Dr.	60,000
	To Bank A/c (50,000 x 66.80)		33,40,000
	(Being payment made $ 50,000 @ Rs. 66.80 and FE loss adjusted $ 50,000 [66.80 -6S.60]
31.3.18	Exchange Difference A/c Dr.	75,000
	To Profit & Loss A/c		75,000
	(Being the net qifference) (1,35,000 - 60,000)

Vide· AS 11, exchange difference on payable (even in respect of fixed assets) are to be adjusted inthe P & L A/c.