n January 1, 2014, Trenten Systems, a U.S.-based company, purchased a controlling interest in Grant Management Consultants located in Zurich, Switzerland. The acquisition was treated as a purchase transaction. The 2014 financial statements stated in Swiss francs are given below. GRANT MANAGEMENT CONSULTANTS Comparative Balance Sheets January 1 and December 31, 2014 Jan. 1 Dec. 31 Cash and Receivables 20,300 55,200 Net Property, Plant, and Equipment 39,600 36,800 Totals 59,900 92,000 Accounts and Notes Payable 30,200 31,500 Common Stock 19,600 19,600 Retained Earnings 10,100 40,900 Totals 59,900 92,000 GRANT MANAGEMENT CONSULTANTS Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2014 Revenues 76,300 Operating Expenses including Depreciation of 2,800 francs 30,400 Net Income 45,900 Dividends Declared and Paid 15,100 Increase in Retained Earnings 30,800 Direct exchange rates for Swiss franc are: Dollars per Franc January 1, 2014 $0.5987 December 31, 2014 0.5321 Average for 2014 0.5654 Dividend declaration and payment date 0.5810 (a) Your answer is correct. Translate the year-end balance sheet and income statement of the foreign subsidiary using the current rate method of translation. (Round answers to 0 decimal places, e.g. 5,125. Enter loss and debit cumulative translation adjustment using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Swiss Francs Translation Rate $ Consolidated Income and Retained Earnings Statement $ Balance Sheet Total Total SHOW LIST OF ACCOUNTS LINK TO TEXT Attempts: 3 of 5 used (b) Prepare a schedule to verify the translation adjustment. (Round answers to 0 decimal places, e.g. 5,125. Enter loss and debit cumulative translation adjustment using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Swiss Francs Translation Rate $ $

n January 1, 2014, Trenten Systems, a U.S.-based company, purchased a controlling interest in Grant Management Consultants located in Zurich, Switzerland. The acquisition was treated as a purchase transaction. The 2014 financial statements stated in Swiss francs are given below. GRANT MANAGEMENT CONSULTANTS Comparative Balance Sheets January 1 and December 31, 2014 Jan. 1 Dec. 31 Cash and Receivables 20,300 55,200 Net Property, Plant, and Equipment 39,600 36,800 Totals 59,900 92,000 Accounts and Notes Payable 30,200 31,500 Common Stock 19,600 19,600 Retained Earnings 10,100 40,900 Totals 59,900 92,000 GRANT MANAGEMENT CONSULTANTS Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2014 Revenues 76,300 Operating Expenses including Depreciation of 2,800 francs 30,400 Net Income 45,900 Dividends Declared and Paid 15,100 Increase in Retained Earnings 30,800 Direct exchange rates for Swiss franc are: Dollars per Franc January 1, 2014 $0.5987 December 31, 2014 0.5321 Average for 2014 0.5654 Dividend declaration and payment date 0.5810 (a) Your answer is correct. Translate the year-end balance sheet and income statement of the foreign subsidiary using the current rate method of translation. (Round answers to 0 decimal places, e.g. 5,125. Enter loss and debit cumulative translation adjustment using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Swiss Francs Translation Rate $ Consolidated Income and Retained Earnings Statement $ Balance Sheet Total Total SHOW LIST OF ACCOUNTS LINK TO TEXT Attempts: 3 of 5 used (b) Prepare a schedule to verify the translation adjustment. (Round answers to 0 decimal places, e.g. 5,125. Enter loss and debit cumulative translation adjustment using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Swiss Francs Translation Rate $ $

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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(a)


	Your answer is correct.

Translate the year-end balance sheet and income statement of the foreign subsidiary using the current rate method of translation. (Round answers to 0 decimal places, e.g. 5,125. Enter loss and debit cumulative translation adjustment using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).)

	Swiss Francs	Translation Rate	$
Consolidated Income and Retained Earnings Statement
		$






Balance Sheet


Total





Total

SHOW LIST OF ACCOUNTS

LINK TO TEXT

Attempts: 3 of 5 used

(b)

Prepare a schedule to verify the translation adjustment. (Round answers to 0 decimal places, e.g. 5,125. Enter loss and debit cumulative translation adjustment using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).)

Swiss Francs	Translation Rate	$
	$

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