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An entity purchases equipment from a foreign supplier for €6 million on March 31, 20X6, when the exchange rate was €2 = $1. The entity also sells goods to a foreign customer for €3.5 million on April 30, 20X6, when the exchange rate was €1.75 = $1. At the entity's year-end of May 31, 20X6, the amounts have not been paid. The closing exchange rate was €1.5 = $1. The entity's functional currency is the dollar.
Required
Calculate the exchange differences that would be recorded in profit or loss for the period ending May 31, 20X6.
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