ADVANCED ACCOUNTING
13th Edition
ISBN: 9781264046263
Author: Hoyle
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 10, Problem 29P
a.
To determine
What is the translation adjustment for subsidiary in 2017 when functional currency is US Dollar?
b.
To determine
What is the re-measurement gainer loss for 2017 when US Dollar subsidiaries functional currency.
c.
To determine
What is the translated value of land of land account on December 31, 2017. What is the measured value of land in balance sheet?
Expert Solution & Answer
![Check Mark](/static/check-mark.png)
Trending nowThis is a popular solution!
![Blurred answer](/static/blurred-answer.jpg)
Students have asked these similar questions
Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2017 with three assets: cash of 20,000 dinars, accounts receivable of 80,000 dinars, and land that cost 200,000 dinars when acquired on April 1, 2016. On January 1, 2017, Zugar has a 150,000 dinar note payable, and no other liabilities. On May 1, 2017, Zugar renders services to a customer for 120,000 dinars, which was immediately paid in cash. On June 1, 2017, Zugar incurred a 100,000 dinar operating expense, which was immediately paid in cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow:
April 1, 2016 . . . . .. . $0.33 = 1 dinar January 1, 2017 . . . . .. . . 0.36 = 1 May 1, 2017 . . . . . . . . .. . . 0.37 = 1 June 1, 2017 . . . . . .. . . . . 0.39 = 1 December 31, 2017 . . . . . 0.41 = 1
a. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the dinar is the…
Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2020 with three assets: cash of 24,600 dinars,
accounts receivable of 81,300 dinars, and land that cost 213,000 dinars when acquired on April 1, 2019. On January 1, 2020, Zugar has
a 163,000 dinar note payable, and no other liabilities. On May 1, 2020, Zugar renders services to a customer for 133,000 dinars, which
was immediately paid in cash. On June 1, 2020, Zugar incurred a 113,000 dinar operating expense, which was immediately paid in
cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow:
April 1, 2019
January 1, 2020
May 1, 2020
June 1, 2020
December 31, 2020
Positive
1 dinar
$0.46 =
0.49
1
0.50
1
0.52 = 1
0.54
1
a.
b. Remeasurement gain
C.
Translated value of land
Remeasured value of land
|| || ||
a. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume
also that the dinar is…
Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2020 with three assets: cash of 20,000 dinars,
accounts receivable of 80,000 dinars, and land that cost 200,000 dinars when acquired on April 1, 2019. On January 1, 2020, Zugar
has a 150,000 dinar note payable, and no other liabilities. On May 1, 2020, Zugar renders services to a customer for 120,000 dinars,
which was immediately paid in cash. On June 1, 2020, Zugar incurred a 100,000 dinar operating expense, which was immediately paid
in cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow:
April 1, 2019
January 1, 2020
May 1, 2020
June 1, 2020
December 31, 2020
a.
b.
Positive
$0.33
0.36 = 1
0.37 = 1
0.39 = 1
0.41
1
a.
Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume
also that the dinar is the subsidiary's functional currency. What is the translation adjustment for this…
Chapter 10 Solutions
ADVANCED ACCOUNTING
Ch. 10 - Prob. 1QCh. 10 - What causes balance sheet (or translation)...Ch. 10 - Prob. 3QCh. 10 - Prob. 4QCh. 10 - Prob. 5QCh. 10 - Prob. 6QCh. 10 - Prob. 7QCh. 10 - Prob. 8QCh. 10 - Prob. 9QCh. 10 - Prob. 10Q
Ch. 10 - Prob. 11QCh. 10 - Which translation method does U.S. GAAP require...Ch. 10 - Prob. 13QCh. 10 - Prob. 1PCh. 10 - Prob. 2PCh. 10 - Prob. 3PCh. 10 - Prob. 4PCh. 10 - Prob. 5PCh. 10 - Prob. 6PCh. 10 - Prob. 7PCh. 10 - Prob. 8PCh. 10 - What amount does Newberrys consolidated income...Ch. 10 - Prob. 10PCh. 10 - Prob. 11PCh. 10 - Prob. 12PCh. 10 - Prob. 13PCh. 10 - Prob. 14PCh. 10 - Prob. 15PCh. 10 - Prob. 16PCh. 10 - Prob. 17PCh. 10 - A foreign subsidiarys functional currency is its...Ch. 10 - Prob. 19PCh. 10 - Prob. 20PCh. 10 - Prob. 21PCh. 10 - Prob. 22PCh. 10 - The following accounts are denominated in rubles...Ch. 10 - Prob. 24PCh. 10 - Prob. 25PCh. 10 - Sullivans Island Company began operating a...Ch. 10 - Prob. 27PCh. 10 - Prob. 28PCh. 10 - Prob. 29PCh. 10 - Prob. 30PCh. 10 - Prob. 31PCh. 10 - Prob. 32PCh. 10 - Prob. 33PCh. 10 - The following account balances are for the Agee...Ch. 10 - Prob. 35PCh. 10 - Prob. 36PCh. 10 - Prob. 37PCh. 10 - Prob. 38PCh. 10 - Prob. 1DYSCh. 10 - RESEARCH CASE 2FOREIGN CURRENCY TRANSLATION...Ch. 10 - Prob. 3DYSCh. 10 - Prob. 4DYSCh. 10 - Prob. 5DYS
Knowledge Booster
Similar questions
- Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2020 with three assets: cash of 20,000 dinars, accounts receivable of 80,000 dinars, and land that cost 200,000 dinars when acquired on April 1, 2019. On January 1, 2020, Zugar has a 150,000 dinar note payable, and no other liabilities. On May 1, 2020, Zugar renders services to a customer for 120,000 dinars, which was immediately paid in cash. On June 1, 2020, Zugar incurred a 100,000 dinar operating expense, which was immediately paid in cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow: April 1, 2019 $0.33 = 1 dinar January 1, 2020 0.36 = 1 May 1, 2020 0.37 = 1 June 1, 2020 0.39 = 1 December 31, 2020 0.41 = 1 Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the dinar is the subsidiary’s functional currency. What is the translation…arrow_forwardZugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2024 with three assets: cash of 27,800 dinars, accounts receivable of 81,900 dinars, and land that cost 219,000 dinars when acquired on April 1, 2023. On January 1, 2024, Zugar has a 169,000 dinar note payable, and no other liabilities. On May 1, 2024, Zugar renders services to a customer for 139,000 dinars, which was immediately paid in cash. On June 1, 2024, Zugar incurred a 119,000 dinar operating expense, which was immediately paid in cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow: April 1, 2023 January 1, 2024 May 1, 2024 June 1, 2024 December 31, 2024 Required: $ 0.52 = 1 dinar 0.55 = 1 dinar 0.561 dinar 0.58 1 dinar 0.60 = 1 dinar a. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the dinar is the subsidiary's functional currency. What is the translation…arrow_forwardGold Corporation began its operation at the beginning of 2018. Its functional currency is the US dollar and its presentation currency is the Philippine peso. Gold Corporation had cash of $225,000 and common stock of $225,000 on January 1, 2018. At the beginning of February, Gold Corporation purchased land for $80,000 and building for $55,000 in exchange for a three-year note payable. Revenue for 2018 was $355,000. Operating expenses, including depreciation of $5,000, were $250,000. The statement of financial position for Gold Corporation in US dollar at the end of 2018 is as follows: Gold Company Balance Sheet December 31, 2018 Assets US Dollars Cash 105,000 170,000 100,000 50,000 425.000 Accounts receivable Land Building, net Total assets Liabilities and Shareholders' Equity Accounts payable Long-term debt Share capital Retained earnings Total liabilities and stockholders' equity 10,000 155,000 225,000 35.000 425.000 Additional land was purchased in March in exchange for a three-year…arrow_forward
- ces Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2024 with three assets: cash of 23,000 dinars, accounts receivable of 81,000 dinars, and land that cost 210,000 dinars when acquired on April 1, 2023. On January 1, 2024, Zugar has a 160,000 dinar note payable, and no other liabilities. On May 1, 2024, Zugar renders services to a customer for 130,000 dinars, which was immediately paid in cash. On June 1, 2024, Zugar incurred a 110,000 dinar operating expense, which was immediately paid in cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow: April 1, 2023 January 1, 2024 May 1, 2024 June 1, 2024 December 31, 2024 Required: $ 0.43 = 1 dinar 0.46 = 1 dinar 0.47 = 1 dinar 0.49 = 1 dinar 0.51 = 1 dinar a. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the dinar is the subsidiary's functional currency. What is the…arrow_forwardpennymarkets corp, a US firm, acquired Supervalu, on January 1, 2019. Supervalu is a swedish company that has been in existence for several years, and whose functional currency is the US dollar. Compartiive account balances for January 1 and December 31, 2019, appear below, measured in Krona (kr), the swedish currency. Account balance 12/31/2019 1/1/2019 Cash kr 240,000 kr 175,000 Accounts receivable, net 360,000 400,000 Plant and Equipment, net 2,000,000 2,320,000 Account payable (200,000) (535,000) Notes payable (600,000) (800,000) Capital stock (400,000) (400,000) Retained Earnings, Jan 1 (1,160,000) (1,160,000) Sales (1,200,000) Depreciation Expense 320,000 Other Expense 640,000 Totals 0 0 $/kr Exchange Rates: January 1, 2019 0.13 Average for 2019 0.14 December 31, 2019 0.16 Translate Supervalu's 2019 ending trial balance into US dollars. Include a schedule calculating the 2019…arrow_forwardKingsfield establishes a subsidiary operation in a foreign country on January 1, 2017. The country’s currency is the kumquat (KQ). To start this business, Kingsfield invests 10,000 kumquats. Of this amount, it spends 3,000 kumquats immediately to acquire equipment. Later, on April 1, 2017, it also purchases land. All subsidiary operational activities occur at an even rate throughout the year. The U.S. dollar ($) exchange rates for the kumquat for 2017 follow:As of December 31, 2017, the subsidiary reports the following trial balance:A corporation based in East Lansing, Michigan, Kingsfield uses the U.S. dollar as its reporting currency.a. Assume that the subsidiary’s functional currency is the kumquat. Prepare a trial balance for it in U.S. dollars so that 2017 consolidated financial statements can be prepared.b. Assume that the subsidiary’s functional currency is the U.S. dollar. Prepare a trial balance for it in U.S. dollars so that 2017 consolidated financial statements can be…arrow_forward
- Eximco Corporation (based in Champaign, Illinois) has a number of transactions with companies in the country of Mongagua, where the currency is the mong. On November 30, 2017, Eximco sold equipment at a price of 500,000 mongs to a Mongaguan customer that will make payment on January 31, 2018. In addition, on November 30, 2017, Eximco purchased raw materials from a Mongaguan supplier at a price of 300,000 mongs; it will make payment on January 31, 2018. To hedge its net exposure in mongs, Eximco entered into a two-month forward contract on November 30, 2017, to deliver 200,000 mongs to the foreign currency broker in exchange for $104,000. Eximco properly designates its forward contract as a fair value hedge of a foreign currency receivable. The following rates for the mong apply: Date Spot Rate Forward Rate ( to January 31, 2018) November 30, 2017 $0.53 $0.52 December 31, 2017 0.50 0.48 January 31, 2018 0.49 N/A Eximco’s incremental borrowing rate is 12 percent. The…arrow_forwardEximco Corporation (based in Champaign, Illinois) has a number of transactions with companies in the country of Mongagua, where the currency is the mong. On November 30, 2017, Eximco sold equipment at a price of 500,000 mongs to a Mongaguan customer that will make payment on January 31, 2018. In addition, on November 30, 2017, Eximco purchased raw materials from a Mongaguan supplier at a price of 300,000 mongs; it will make payment on January 31, 2018. To hedge its net exposure in mongs, Eximco entered into a two-month forward contract on November 30, 2017, to deliver 200,000 mongs to the foreign currency broker in exchange for $104,000. Eximco properly designates its forward contract as a fair value hedge of a foreign currency receivable. The following rates for the mong apply:Eximco’s incremental borrowing rate is 12 percent. The present value factor for one month at an annual interest rate of 12 percent (1 percent per month) is 0.9901.a. Prepare all journal entries, including…arrow_forwardOn July 1, 2017, Mifflin Company borrowed 200,000 euros from a foreign lender evidenced by an interest-bearing note due on July 1, 2018. The note is denominated in euros. The U.S. dollar equivalent of the note principal is as follows: Date AmountJuly 1, 2017 (date borrowed) $225,000December 31, 2017 (Mifflin’s year-end) 220,000 July 1, 2018 (date repaid) 210,000 In its 2018 income statement, what amount should Mifflin include as a foreign exchange gain or loss on the note? Choose the correct.a. $15,000 gainb. $15,000 lossc. $10,000 gaind. $10,000 lossarrow_forward
- Following are the information on some transactions of Saint-Germain Ltd. in Paris, France, in 2019 (currency in EU euro, €): A. Pre-tax cash sales on April 2 totaled €256,000. The VAT rate is 20%.B. The annual property tax bill for 2019 of €12,000 is received on May 1. The property tax is paid in full on June 30 and is to be adjusted for accrued expense at year end. Saint-Germain has a calendar year end for its accounting and records adjusting entries annually.C. Saint-Germain’s gross salary amounts to €10,000 for the week ended July 11. Amounts deducted from the employees’ salaries are pension contribution of €495, employment insurance of €178, income tax of €3,465, and health insurance of €950. On July 11, cash is paid to the employees, less the payroll deduction amounts withheld.D. Accrued interest on December 31 (the company’s yearend) for a three-month, 6%, €10,000 bank loan effective December 1. Interest is payable on the first of each month.E. In November 2019, a customer sued…arrow_forwardChoy Co. of New York purchased rice from China for 100,000 renminbi (r) on Nov. 1, 2015. Payment is due on Jan. 30, 2016. The rates were as follows: Spot Rate $0.121 $0.124 $0.126 Date Nov. 1, 2015 Dec. 31, 2015 Jan. 30, 2016 a) Record all journal entries on the transaction, balance sheet and settlement dates. Show computations. b) What is Choy's overall gain or loss from these transactions? Show computations.arrow_forwardOn July 1, 2025, Bonita Inc. made two sales. 1. 2. Bonita Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest. It sold land having a fair value of $901,000 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,417,737. The land is carried on Bonita's books at a cost of $592,800. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $403,820 (interest payable annually). Record the two journal entries that should be recorded by Bonita Inc. for the sales transactions above that took place on July 1, 2025. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to O decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
![Text book image](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Text book image](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
![Text book image](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
![Text book image](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
![Text book image](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
![Text book image](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education