Provide the accounting entries necessary

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Question - On 14 August 2020 an Australian company acquires goods on credit from a supplier in London. Their goods are shipped from London 14 August 2020.

The cost of the goods is UK £300,000 and the debt remains unpaid on 31 December 2020. On 14 August the exchange rate is A$1.00 = UK£0.44.

On the 31 December 2020 it is A$1.00 = UK£0.38. Hence the value of the Australian dollar has decreased relative to the UK pound. The Australian companies reporting date is 31 December.

Settlement occurred on the 15 February 2021 and the exchange rate on this date was A$1.00 = UK£0.35.

Required - Provide the accounting entries necessary to account for the above purchase by the Australian company for the year ending 31 December 2020 and on settlement date 15 February 2021 in accordance with the requirement of AASB 121. Show all workings.

Reference no: EM133173346

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