INTERNATIONAL ACCOUNTING
5th Edition
ISBN: 9781307458879
Author: Doupnik
Publisher: MCG/CREATE
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Question
Chapter 7, Problem 22EP
a.
To determine
Prepare translated financial statements of subsidiary as per International Financial Reporting Standards (IFRS).
b.
To determine
Prepare translated financial statements of subsidiary as per Generally Accepted Accounting Principles (GAAP).
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Students have asked these similar questions
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?
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…
The controller of Pane Co. was preparing the company's financial statements. Pane had a
wholly owned subsidiary in a foreign country that used the euro as its currency. At December
31, the exchange rate was $1 U.S. for 1.25 euro. The weighted-average exchange rate for the
year was $1 U.S. for 1.50 euro. At December 31, the subsidiary had assets of 1 million euro and
revenue for the year of 2 million euro. What amounts would assets and revenue translate for
consolidation?
Assets Revenue
A. $666,666 $1,333,333
B. $666,666 $1,600,000
C. $800,000 $1,333,333
D. $800,000 $1,600,000
Chapter 7 Solutions
INTERNATIONAL ACCOUNTING
Ch. 7 - Prob. 1QCh. 7 - Prob. 2QCh. 7 - Prob. 3QCh. 7 - Prob. 4QCh. 7 - Prob. 5QCh. 7 - 6. What are the major differences between IFRS and...Ch. 7 - Prob. 7QCh. 7 - 8. Which translation method does U.S. GAAP require...Ch. 7 - Prob. 9QCh. 7 - 10. How are gains and losses on foreign currency...
Ch. 7 - Prob. 11QCh. 7 - Prob. 12QCh. 7 - Prob. 1EPCh. 7 - Prob. 2EPCh. 7 - Prob. 3EPCh. 7 - Prob. 4EPCh. 7 - 4. Which of the following best explains how a...Ch. 7 - In the translated financial statements, which...Ch. 7 - Prob. 7EPCh. 7 - Prob. 8EPCh. 7 - Prob. 9EPCh. 7 - Prob. 10EPCh. 7 - The Year 1 financial statements of the Chinese...Ch. 7 -
10. Simga Company's Turkish subsidiary repented...Ch. 7 - Prob. 13EPCh. 7 - Prob. 14EPCh. 7 - Prob. 15EPCh. 7 - Prob. 16EPCh. 7 - Prob. 17EPCh. 7 - Prob. 18EPCh. 7 - 16. Access the most recent annual report for a...Ch. 7 - Prob. 21EPCh. 7 - Prob. 22EPCh. 7 - Prob. 1CCh. 7 - Prob. 2C
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