Striking Furs imports furs from Canada. In the space provided below, prepare journal entries to record the following events.

Striking Furs imports furs from Canada. In the space provided below, prepare journal entries to record the following events.

• Dec. 11, 2017: Purchased furs from Capable Trappers, Ltd., a Canadian corporation, at a price of 25,000 Canadian dollars, due in 60 days. The current exchange rate is $0.85 U.S. dollars per Canadian dollar. (Striking uses the perpetual inventory method; debit the Inventory account.)
• Dec. 31, 2017: Striking made a year-end adjusting entry relating to the account payable to Capable Trappers. The exchange rate at year-end is $0.89 U.S. dollars per Canadian dollar.
• Feb. 9, 2018: Issued a check for $21,750 (U.S. dollars) to National Bank in full settlement of the liability to Capable Trappers, Ltd. The exchange rate at this date is $0.87 U.S. dollars per Canadian dollar.

2. Explain ways in which Striking Furs can protect itself against the losses that would arise from a sudden increase in the foreign exchange rate.