Problem 43. The following assets are acquired on January 1, 2015, when the general price index is 200: Inventory P1,000,000 Property, plant and equipment 2,000,000 Investment in Bonds Receivable 3,000,000 The company is reporting in a hyperinflationary economy. On December 31, 2015, the general price index is 300. How shall the assets above be presented in the 12/31/2015 Statement of Financial Position? Problem 44. The statement of financial position of ART Inc. before translation to hyperinflationary economy is presented as follows: Cash 1,000,000 Accounts payable 1,000,000 Accounts receivable 2,000,000 Unearned revenue (1/1/2015) 1,500,000 Inventory (1/1/2015) 3,000,000 Ordinary share (1/1/2015) 2,000,000 PPE (7/1/2015) 4,000,000 Retained earnings 500,000 The general price index are provided for the following dates: 1/1/2015 – 100 7/1/2015 – 200 12/31/2015 – 300 How much retained earnings shall be presented in the translated statement of financial position of ART Inc. in a hyperinflationary economy?
Problem 43. The following assets are acquired on January 1, 2015, when the general price index is 200:
Inventory P1,000,000
Property, plant and equipment 2,000,000
Investment in Bonds Receivable 3,000,000
The company is reporting in a hyperinflationary economy. On December 31, 2015, the general price
index is 300. How shall the assets above be presented in the 12/31/2015
Position
Problem 44. The statement of financial position of ART Inc. before translation to hyperinflationary
economy is presented as follows:
Cash 1,000,000 Accounts payable 1,000,000
Accounts receivable 2,000,000 Unearned revenue (1/1/2015) 1,500,000
Inventory (1/1/2015) 3,000,000 Ordinary share (1/1/2015) 2,000,000
PPE (7/1/2015) 4,000,000
The general price index are provided for the following dates:
1/1/2015 – 100 7/1/2015 – 200 12/31/2015 – 300
How much retained earnings shall be presented in the translated statement of financial
position of ART Inc. in a hyperinflationary economy?
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