Required information Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 210,000 pesos that is sold on January 17, 2018, for 243,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows: $ 0.54 =1 peso November 1, 2017 December 31, 2017 January 17, 2018 January 31, 2018 0.55 =1 0.56 =1 0.57 =1

Required information Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 210,000 pesos that is sold on January 17, 2018, for 243,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows: $ 0.54 =1 peso November 1, 2017 December 31, 2017 January 17, 2018 January 31, 2018 0.55 =1 0.56 =1 0.57 =1

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter7: Financial Activities

Section: Chapter Questions

Problem 2EIC

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Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 100,000 pesos that is sold on January 17, 2018, for 130,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows: November 1, 2017 $0.16 = 1 peso December 31, 2017 0.17 = 1 January 17, 2018 0.18 = 1 January 31, 2018 0.19 = 1 LO 8-2, 8-3 What amount does Newberry’s consolidated balance sheet report for this inventory at December 31, 2017? $16,000. $17,000. $18,000. $19,000.
Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 100,000 pesos that is sold on January 17, 2018, for 130,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows: November 1, 2017 $0.16 = 1 peso December 31, 2017 0.17 = 1 January 17, 2018 0.18 = 1 What amount does Newberry’s consolidated income statement report for cost of goods sold for the year ending December 31, 2018? $16,000. $17,000. $18,000. $19,000.
Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 150,000 pesos that is sold on January 17, 2018, for 178,000 pesos. The subsidiary pays for the inventoryon January 31, 2018. Currency exchange rates are as follows: November 1, 2017 $ .18 = 1 peso December 31, 2017 .19 = 1 January 17, 2018 .20 = 1 January 31, 2018 .21 = 1 1. What amount does Newberry’s consolidated balance sheet report for this inventory at December 31, 2017?$28,500.$27,000.$30,000.$31,500. 2. What amount does Newberry’s consolidated income statement report for cost of goods sold for the year ending December 31, 2018?$27,000.$30,000.$28,500.$31,500.
Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 100,000 pesos that is sold on January 17, 2018, for 130,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows:Cost of goods sold . . .. LCU 5,000,000Beginning inventory . . . . . . . 500,000Ending inventory . . . . . . . . . . 600,000November 1, 2017 . . . . $0.16 = 1 pesoDecember 31, 2017 . ...... . . 0.17 = 1January 17, 2018 . . . . . . . . . 0.18 = 1January 31, 2018 . . . . . . . . 0.19 = 1 What amount does Newberry’s consolidated balance sheet report for this inventory at December 31, 2017? Choose the correct.a. $16,000.b. $17,000.c. $18,000.d. $19,000.
Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 100,000 pesos that is sold on January 17, 2018, for 130,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows:Cost of goods sold . . .. LCU 5,000,000Beginning inventory . . . . . . . 500,000Ending inventory . . . . . . . . . . 600,000November 1, 2017 . . . . $0.16 = 1 pesoDecember 31, 2017 . ...... . . 0.17 = 1January 17, 2018 . . . . . . . . . 0.18 = 1January 31, 2018 . . . . . . . . 0.19 = 1What amount does Newberry’s consolidated income statement report for cost of goods sold for the year ending December 31, 2018?a. $16,000.b. $17,000.c. $18,000.d. $19,000.
Problems 8 and 9 are based on the following information.Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 100,000 pesos that is sold on January 17, 2018, for 130,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows:What amount does Newberry’s consolidated balance sheet report for this inventory at December 31, 2017?a. $16,000.b. $17,000.c. $18,000.d. $19,000.
A subsidiary of Cadbury Corp. located in a foreign country whose functional currency is the foreign currency. The subsidiary acquires inventory on credit on November 1, 2015, for 100,000 foreign currencies (F) that is sold on January 17, 2016 for 130,000 foreign currencies (FC). The subsidiary pays for the inventory on January 31, 2016. Currency exchange rates for 1 foreign currency (FC) are as follows:November 1, 2015 P 0.16 = 1 FCNovember 31, 2015 0.17 = 1November 17, 2016 0.18 = 1January 31, 2016 0.19 = 1Average for 2016 0.20 = 14. What amount does Cadbury’s consolidated balance sheet report for this inventory at December 31, 2015?A. P 16,000 B. P 17,000 C. P 18,000 D. P 19,0005. What amount does Cadbury’s consolidated income statement report for cost of goods sold for the year ending December 31, 2016?A. P 16,000 B. P 17,000 C. P 18,000 D. P 19,000
A subsidiary of Dunder Inc., a U.S. company, was located in a foreign country. The functional currency of this subsidiary was the Stickle (§) which is the local currency where the subsidiary is located. The subsidiary acquired inventory on credit on November 1, 2020, for §160,000 that was sold on January 17, 2021 for §207,000. The subsidiary paid for the inventory on January 31, 2021. Currency exchange rates between the dollar and the Stickle were as follows: November 1, 2020 $ 0.21 = § 1 December 31, 2020 $ 0.22 = § 1 January 1, 2021 $ 0.24 = § 1 January 31, 2021 $ 0.25 = § 1 Average for 2021 $ 0.27 = § 1 What amount would have been reported for this inventory in Dunder’s consolidated balance sheet at December 31, 2020?
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On December 31, 2008 a foreign subsidiary in US submitted the following balances stated in foreign currency:In US$ Total Assets 140,000 Total Liabilities 28,000 Ordinary Share 70,000 Retained Earnings 42,000 Relevant exchange rates are: current rate – P8.75; historical rate – P8.10; weighted average rate – P8.50. Assuming that the retained earnings of the subsidiary in December 31, 2008 translated to the peso is P290,000. What amount of cumulative translation adjustment is to be reported in the consolidated balance sheet on December 31, 2008?
At the end of 2020, an Italian subsidiary of a U.S. parent reports €1,000,000 in equipment purchased when the exchange rate was $1.40, and €3,000,000 in equipment purchased when the exchange rate was $1.50. The average exchange rate for 2020 is $1.35, and the beginning and ending rates for 2020 are $1.42 and $1.31, respectively. If the Italian subsidiary’s functional currency is the U.S. dollar, the equipment account, in U.S. dollars, is a. $5,240,000 b. $5,350,000 c. $5,400,000 d. $5,900,000
XYZ Corp, has carried out transactions denominated in foreign currency during the financial year ended 31 October 2019 and has conducted foreign operations through a foreign entity. Its functional and presentation currency is the US dollar. XYZ purchased inventory from a foreign supplier for Euros 8 million on 31 July 2019, the trade payable was still outstanding and the inventory were still held by XYZ Corp. XYZ Corp sold its products to a foreign customer for Euros 4 million on 31 July 2019 and received payment for the products in euros on 31 October 2019. Additionally, XYZ Corp purchase investment property on 1 November 2018 for Euros 28 million. At 31 October 2019, the investment property had a fair value of Euros 24 million. The company uses the fair value model in accounting for its investment properties. XYZ would like advice on how to treat this transactions in the financial statement for the year ended 31 October 2019. Exchange rates Date Euro:$ Average Rate for Year to…