Foreign exchange gain

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Foreign exchange gain

We have 2 bank accts CAD and USD but all our books are in CAD. There are only a few customers and vendor transactions denominated in USD and we have the multi-currency functionality turned on. At the end of Dec 2013, the actual balance on the USD account is $10,873, 82, whilst the balance in the books of account 1065(Foreign chequing account in Sage) is $6,888.98. As it is the end of the year we want to reconcile the Actual Bank with the book balance. We printed an Unrealized Exchange Gain/Loss report from the system and it shows a gain of $3984.84.

My question is

1)      How does Sage record this $3984, I can’t seem to be able to find it anywhere

2)      How do I post the Unrealized gain of $3984 so that the balance in the book is $11,416(being 10,8763USD at a rate of 1.05, the rate of the CAD to the USD at Dec 31)

3)      Presumably, there will be 2 steps. Step 1- to record the difference between 10,873 and 6,888. Step 2- to revalue the bank balance of 10, 873USD to 11,416CAD

Can you help with the entries please. I have looked on the Knowledge database but could not find anything related.

Thanks for your help