ADVANCED ACCOUNTING-LL
ADVANCED ACCOUNTING-LL
13th Edition
ISBN: 9781260232486
Author: Hoyle
Publisher: MCGRAW-HILL CUSTOM PUBLISHING
Question
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Chapter 10, Problem 32P

a.

To determine

Prepare trial balance for subsidiary company so that 2017 consolidated financial statement when functional currency is kumquat.

b.

To determine

Prepare trial balance for subsidiary when US Dollar is functional currency.

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Agullar Company establishes a subsidiary operation in a foreign country on January 1, 2024. The country's currency is the rial (R). To start this business, Agullar Invests 10,000 rials. Of this amount, It spends 3,000 rials Immediately to acquire equipment. Later, on April 1. 2024, It also purchases land. All subsidiary operational activities occur at an even rate throughout the year. Aguilar uses the U.S. dollar as its reporting currency. The U.S. dollar ($) exchange rates for the rial for 2024 follow: January 1 April 1 June 1 Cash Accounts receivable Equipment Accumulated depreciation Land Accounts payable Notes payable (due 2032) Common stock Dividends declared (6/1/24) Sales Salary expense Weighted average December 31 As of December 31, 2024, the subsidiary reports the following trial balance: Depreciation expense Miscellaneous expenses Totals Cash Accounts receivable Equipment Accumulated depreciation $ 1.71 1.59 1.66 Land Accounts payable Notes payable Common stock Dividends…
Kingsfield establishes a subsidiary operation in a foreign country on January 1, 2020. The country’s currency is the rial (R). To start this business, Kingsfield invests 10,000 rials. Of this amount, it spends 3,000 rials immediately to acquire equipment. Later, on April 1, 2020, it also purchases land. All subsidiary operational activities occur at an even rate throughout the year. Kingsfield uses the U.S. dollar as its reporting currency. The U.S. dollar ($) exchange rates for the rial for 2020 follow:         January 1 $ 1.71 April 1   1.59 June 1   1.66 Weighted average   1.64 December 31   1.62     As of December 31, 2020, the subsidiary reports the following trial balance:     Debits   Credits Cash R 8,000       Accounts receivable   9,000       Equipment   3,000       Accumulated depreciation       R 600 Land   5,000       Accounts payable         3,000 Notes payable (due 2028)         5,000 Common stock         10,000 Dividends declared…
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.
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