The following balance sheet accounts of a foreign subsidiary at December 31, 2011, have been translated into U.S. dollars as follows: Translated at Current Rates Historical Rates Accounts receivable, current $ 600,000 $ 660,000 Accounts receivable, long-term 300,000 324,000 Inventories carried at market 180,000 198,000 Goodwill 190,000 220,000 $1,270,000 $1.402,000

The following balance sheet accounts of a foreign subsidiary at December 31, 2011, have been translated into U.S. dollars as follows: Translated at Current Rates Historical Rates Accounts receivable, current $ 600,000 $ 660,000 Accounts receivable, long-term 300,000 324,000 Inventories carried at market 180,000 198,000 Goodwill 190,000 220,000 $1,270,000 $1.402,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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?
Certain balance sheet accounts of a foreign subsidiary of Orchid Company have been stated in U.S. dollars as follows: Stated at Current Rates Historical Rates Accounts receivable, current $ 276,000 $ 296,000 Accounts receivable, long term 128,000 135,000 Land 64,000 67,000 Patents 92,000 97,000 $ 560,000 $ 595,000 This subsidiary’s functional currency is the U.S. dollar. What total should Orchid’s balance sheet include for the preceding items? a. $560,000. b. $575,000. c. $565,000. d. $568,000.
Certain balance sheet accounts of a foreign subsidiary of Orchid Company have been stated in U.S. dollars as follows: Stated at Current Rates Historical Rates Accounts receivable, current $ 155,000 $ 175,000 Accounts receivable, long term 108,000 115,000 Land 54,000 59,000 Patents 83,000 88,000 $ 400,000 $ 437,000 This subsidiary’s functional currency is the U.S. dollar. What total should Orchid’s balance sheet include for the preceding items?
Certain balance sheet accounts of a foreign subsidiary of Orchid Company have been stated in U.S. dollars as follows: Current Rates Historical Rates Accounts receivable, current $ 235,000 $255,000 Accounts receivable, long term 142,000 149,000 land 71,000 74,000 Patents 101,000 106,000 $ 549,000 $ 584,000 1. This subsidiary’s functional currency is a foreign currency. What total should Orchid’s balance sheet include for the preceding items?$557,000.$554,000.$564,000.$549,000. 2. This subsidiary’s functional currency is the U.S. dollar. What total should Orchid’s balance sheet include for the preceding items?$554,000.$557,000.$564,000.$549,000
Given the following balance sheet of a US based MNC’s fully operational subsidiary, who operates in Japan and whose functional currency is the Japanese Yen, determine the amount of the translation exposure in dollars if the Yen depreciates by 10% from ¥110/$ to ~¥122/$ by applying the current rate method. Balance Sheet of Subsidiary in ¥ Assets Liabilities + Equity Cash ¥145,000 Accounts Payable ¥246,000 A/R ¥104,000 Short Term Debt ¥128,000 Inventory ¥275,000 Long term debt ¥329,000 PPE ¥895,000 Common Stock ¥534,000 Retained Earnings ¥182,000 Total ¥1,419,000 ¥1,419,000
Certain balance sheet accounts of a foreign subsidiary of Paul Inc. at December 31, year 1, have been translated in US dollars as follows: Translated at Current Rates Historical Rates Note recievable, long term P 240,000 P 200,000 Prepaid rent 85,000 80,000 Patent 150,000 170,000 P 475,000 P 450,000 The subsidiary's functional currency is…
Certain balance sheet accounts of a foreign subsidiary of Orchid Company have been stated in U.S. dollars as follows: Current Rates Historical Rates Accounts Receivable, current $200000 $220000 Accounts Receivable, long term 100000 110000 Land 50000 55000 Patents 80000 85000 Total $430000 $470000 This subsidiary’s functional currency is the U.S. dollar. What total should Orchid’s balance sheet include for the preceding items?a. $430,000.b. $435,000.c. $440,000.d. $450,000.
Newberry, Inc., whose reporting currency is the U.S. dollar ($), 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 = 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. $19,000.
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The trial balance of Honesty Company at December 31, 2022, a foreign subsidiary of ABC Company, is presented below (denominated in US dollars) (see image below).T he translated amount of Retained Earnings is P325,000. Exchange rates were: Current Rate - P10; Historical Rate - P11; and Weighted Average Rate - P12. Answer the following subquestion(s): a. How much is the Cumulative Translation Adjustment at December 31, 2022? ______________ thanks!
Newberry, Inc., whose reporting currency is the U.S. dollar ($), 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.
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