Adjustment for Currency Gain

Effect on Balance sheet
DR CR
Creditors (-) Retained Earnings (+)

During the period between the submission and the payment of the invoice for imported fixed assets, the foreign currency has devalued giving a currency gain.
 
Amount in USD Exchange Rate Amount in GBP
Invoiced (in TT2)
Paid (in TT14)
Note: The paid exchange rate in TT14 should be greater than the invoiced exchange rate in TT2 as TT14 is linked to TT2 and TT8 and the changes in these transactions.
Currency Gain
Original values

Balance Sheet Original

ASSETS
Current Assets 767850
Bank 758550
Debtors and Prepayments 9300
Other Current Assets (Stock) 0
Fixed Assets 44000
TOTAL Assets 811850
LIABILITIES
Current Liabilities 44300
Creditors 44000
Accruals 300
Long Term Liabilities 0
Long Term Loan 0
Equity 767550
Shareholders' Equity 800000
Income Statement -32450
TOTAL Liabilities + Equity + Retained Earnings 811850
A. Income
Sale of Licences 0
Software Maintenance after Warranty, Recurrent Licencing Fees, Ongoing Technical Support 0
Unearned income 0
Currency Gains 0
Cost of Goods Sold (Purchase of Licences for Resale) 0
TOTAL INCOME: 0
B. Expenses
Software Upgrading 10000
Web Site Development 2500
Web Maintenance 4000
Technical Support 0
Marketing 0
Staff Salaries 8000
Consultancy and Accountancy 0
Office Costs 3600
General Costs 4350
Inventory Expense 0
Interest on loan 0
Currency Losses 0
TOTAL EXPENDITURE: 32450
Profit (Loss) from Operations
Corporate Tax 0
Dividends Paid 0
Net Profit (Loss): -32450
After changes

Balance Sheet New

ASSETS
Current Assets
Bank
Debtors and Prepayments
Other Current Assets (Stock)
Fixed Assets
TOTAL Assets
LIABILITIES
Current Liabilities
Creditors
Accruals
Long Term Liabilities
Long Term Loan
Equity
Shareholders' Equity
Income Statement
TOTAL Liabilities + Equity + Retained Earnings
A. Income
Sale of Licences
Software Maintenance after Warranty, Recurrent Licencing Fees, Ongoing Technical Support
Unearned income
Currency Gains
Cost of Goods Sold (Purchase of Licences for Resale)
TOTAL INCOME:
B. Expenses
Software Upgrading
Web Site Development
Web Maintenance
Technical Support
Marketing
Staff Salaries
Consultancy and Accountancy
Office Costs
General Costs
Inventory Expense
Interest on loan
Currency Losses
TOTAL EXPENDITURE:
Profit (Loss) from Operations
Corporate Tax
Dividends Paid
Net Profit (Loss):