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Unrealized Foreign Exchange Loss

Adjusting a foreign currency payable at year-end due to exchange rate fluctuations.

Account NameTypeDebit ($)Credit ($)
Unrealized FX LossExpense (+)300.00-
Accounts Payable (Foreign Vendor)Liability (+)-300.00

💡 Accountant's Note

If the exchange rate changes before you pay the bill, you must revalue the liability at the year-end 'spot rate' to follow IFRS/GAAP.

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