Foreign Exchange Gain/loss

In What  case do you want to compute...... plz specify your case
 

have problem in the import purchases: Suppose I paid $5000  @ 45.15 on 25/5/2009 in advance for purchases of material which cost me $25000, I received the material on 30/6/2009, I paid balance amt on 25/6/2009 @ 47.20. On import doc. there is specifically  indicate  tht presentation of dockuments through(wht is the meaning of this?).so at the time of passing the entry rate will have to taken as per BOE for whole $25000 or @ 47.20 *$25000

I'm PCC student , I want to clear my concept !!

pls help me

The foreign exchange is normally recognised on the date you recognise the purchase or sale in your books of account. This is for purchase or sale transactions. For Loans, whether you give or take in foreign exchange you account for it on the date of the event. Every repayment or receipt back will be a gain or loss on that date. Every receipt of sale proceeds or payment of purchase proceed will be a gain or loss whether in advance or after the event.

However, on 31st March, you have to value the amount of foreign exchange receivable or payable per rate on that date and recognise the gain or loss from actual date of transaction. Again when you pay or receive in the next accounting year, if you are a going concern you will again recognise the gain or loss at the time of receipt or payment in respect to the valuation on 31st march rate that is adopted to value the transaction in your balance sheet.

Thanks for ur kind reply.

The word itself says it is nothing an exchange difference.

If you borrowed from a friend 100$ on 1.6.09 and encashed @ rate of Rs. 50.

Let You repaid the same amount on   19.09.09                         @ rate of Rs. 47

Now the gain for you is   100 X Rs. 3

To have the uniformity AS- 11 came in to force. Read it Practicaally. u will get ride of it.

Can any one tell me the impact of foreign exchange of loss / gain in case of import on COD basis? How it arise and its mode of accounting