Foreign Purchases, Sales Transactions and Hedging

Part I
Maple Company had the following export and import transactions during 20X5:
1. On March 1, Maple sold goods to a Canadian company for 30,000 Canadian dollars (C$), receivable on May 30. The spot rates for marks were C$1 _ $.65 on March 1 and C$1 _ $.68 on May 30.
2. On July 1, Maple signed a contract to purchase equipment from a Japanese company for 500,000 yen. The equipment was manufactured in Japan during August and was delivered to Maple on August 30, with payment due in 60 days on October 29. The spot rates for yen were ¥ 1 _ $.102 on July 1, ¥1 _ $.104 on August 30, and ¥1 _ $.106 on October 29. The 60-day forward exchange rate on August 30, 20X5, was ¥1 _ $.1055.
3. On November 16, Maple purchased inventory from a London company for 10,000 pounds, payable on January 15, 20X6. The spot rates for pounds were £1 _ $1.65 on November 16, £1 _ $1.63 on December 31, and £1 _ $1.64 on January 15, 20X6. The forward rate on December 31, 20X5, for a January 15, 20X6, exchange was £1 _ $1.645.

Required:
a. Prepare journal entries to record Maple's import and export transactions during 20X5 and 20X6.
b. What amount of foreign currency transaction gain or loss would Maple report on its income statement for 20X5?
Part II
Assume that Maple used forward contracts to manage the foreign currency risks of all of its export and import transactions during 20X5.
1. On March 1, 20X5, Maple, anticipating a weaker Canadian dollar on the May 30, 20X5, settlement date, entered into a 90-day forward contract to sell 30,000 Canadian dollars at a forward exchange rate of C$1 _ $.64. The forward contract was not designated as a hedge.
2. On July 1, 20X5, Maple, anticipating a strengthening of the yen on the October 29, 20X5, settlement date, entered into a 120-day forward contract to purchase 500,000 yen at a forward exchange rate of ¥1 _ $.105. The forward contract was designated as a fair value hedge of a firm commitment.
3. On November 16, 20X5, Maple, anticipating a strengthening of the pound on the January 15, 20X6, settlement date, entered into a 60-day undesignated forward exchange contract to purchase 10,000 pounds at a forward exchange rate of £1 _ $1.67.

Required:
a. Prepare journal entries to record Maple's foreign currency activities during 20X5 and 20X6.
b. What amount of foreign currency transaction gain or loss would Maple report on its income statement or 20X5, if Parts I and II of this problem were combined?
c. What amount of foreign currency transaction gain or loss would Maple report on its statement of income for 20X6, if Parts I and II of this problem were combined?