foreign currency purchase koreaco produces automobile transmissions which are then s 692210

Foreign Currency Purchase

Koreaco produces automobile transmissions, which are then sent to the United States where they are installed in domestically built cars. CarCo,a U.S. auto company, received a shipment of transmissions on December 15, 2007. The transmissions were subsequently paid for on January 30, 2008. The invoice was denominated in Korean won and totaled 5,000,000 won. The number of Korean won required to purchase 1 U.S. dollar fluctuated as follows:

Provide the necessary journal entries for CarCo to record the above transactions assuming CarCo’s fiscal year end is December 31.