Syracuse Systems purchased inventory on account from Megaple

Syracuse Systems purchased inventory on account from Megaplex. The price was ¥130,000, and a yen was quoted at $0.0086. Syracuse paid the debt in yen a month later when the price of a yen was $0.0094. Syracuse OA. recorded a foreign-currency transaction gain of $104 O B. debited Inventory for $1,118 O C. debited Inventory for $1,222 O D. None of the above.

Solution

Option B. debited Inventoryfor $1,118 is correct option.

Account Titles	Debit	Credit
Inventory (130,000 x $0.0086)	$1,118
To Accounts Payable		$1,118