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On January 1, 2015 FAREWELL CORPORATION organized GOODLUCK Company as subsidiary in Australia with an initial investment cost $ 157,500. GOODLUCK Company's December 31, 2015, trial balance in Australian dollars is as follows: Debit $ 18,375 52,500 13,125 65,625 262,500 Credit Cash and cash equivalents Trade receivables, net Due from Farewell Inventory Machinery and equipment Accumulated depreciation Accounts payable Mortgage bonds payable Ordinary shares Sales Cost of goods sold Selling expenses Depreciation expense Dividends declared ТОTAL Additional information: a. Purchases of merchandise are made evenly throughout the year. Items in the ending inventory were purchased July 1. b. Machinery and equipment are depreciated by the straight line method with a 10-year life and no residual value. A full year's depreciation is taken in the year of acquisition. The equipment was acquired on April 1. c. The dividends were declared and paid on October 1. d. The exchange rates were as follows: January 1 April 1 July 1 $ 26,250 31,500 131,250 157,500 393,750 183,750 78,750 26,250 39,375 $ 740,250 $ 740,250 P 35.50 35.25 35.60 P 35.40 35.00 35.30 October 1 December 31 Average 2015 20. How much is the cumulative translation adjustment in 2015? a. P 94,500 loss b. P 94,500 gain c. P114,187.50 loss d. P114,187.50 gain

On January 1, 2015 FAREWELL CORPORATION organized GOODLUCK Company as subsidiary in Australia with an initial investment cost $ 157,500. GOODLUCK Company's December 31, 2015, trial balance in Australian dollars is as follows: Debit $ 18,375 52,500 13,125 65,625 262,500 Credit Cash and cash equivalents Trade receivables, net Due from Farewell Inventory Machinery and equipment Accumulated depreciation Accounts payable Mortgage bonds payable Ordinary shares Sales Cost of goods sold Selling expenses Depreciation expense Dividends declared ТОTAL Additional information: a. Purchases of merchandise are made evenly throughout the year. Items in the ending inventory were purchased July 1. b. Machinery and equipment are depreciated by the straight line method with a 10-year life and no residual value. A full year's depreciation is taken in the year of acquisition. The equipment was acquired on April 1. c. The dividends were declared and paid on October 1. d. The exchange rates were as follows: January 1 April 1 July 1 $ 26,250 31,500 131,250 157,500 393,750 183,750 78,750 26,250 39,375 $ 740,250 $ 740,250 P 35.50 35.25 35.60 P 35.40 35.00 35.30 October 1 December 31 Average 2015 20. How much is the cumulative translation adjustment in 2015? a. P 94,500 loss b. P 94,500 gain c. P114,187.50 loss d. P114,187.50 gain

FINANCIAL ACCOUNTING
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 January 1, 2015 FAREWELL CORPORATION organized GOODLUCK Company as subsidiary in Australia with an initial investment cost $ 157,500. GOODLUCK Company's December 31, 2015, trial balance in Australian dollars is as follows: Debit Credit |Cash and cash equivalents Trade receivables, net Due from Farewell Inventory Machinery and equipment Accumulated depreciation Accounts payable Mortgage bonds payable Ordinary shares Sales Cost of goods sold Selling expenses Depreciation expense Dividends declared ТОTAL Additional information: a. Purchases of merchandise are made evenly throughout the year. Items in the ending inventory were purchased July 1. b. Machinery and equipment are depreciated by the straight line method with a 10-year life and no residual value. A full year's depreciation is taken in the year of acquisition. The equipment was acquired on April 1. c. The dividends were declared and paid on October 1. d. The exchange rates were as follows: January 1 April 1 July 1 $ 18,375 52,500 13,125 65,625 262,500 $ 26,250 31,500 131,250 157,500 393,750 183,750 78,750 26,250 39,375 $ 740,250 $ 740,250 P 35.50 35.25 October 1 December 31 P 35.40 35.00 35.30 35.60 Average 2015 20. How much is the cumulative translation adjustment in 2015? a. P 94,500 loss b. Р 94,500 gain c. P114,187.50 loss d. P114,187.50 gain
Transcribed Image Text:On January 1, 2015 FAREWELL CORPORATION organized GOODLUCK Company as subsidiary in Australia with an initial investment cost $ 157,500. GOODLUCK Company's December 31, 2015, trial balance in Australian dollars is as follows: Debit Credit |Cash and cash equivalents Trade receivables, net Due from Farewell Inventory Machinery and equipment Accumulated depreciation Accounts payable Mortgage bonds payable Ordinary shares Sales Cost of goods sold Selling expenses Depreciation expense Dividends declared ТОTAL Additional information: a. Purchases of merchandise are made evenly throughout the year. Items in the ending inventory were purchased July 1. b. Machinery and equipment are depreciated by the straight line method with a 10-year life and no residual value. A full year's depreciation is taken in the year of acquisition. The equipment was acquired on April 1. c. The dividends were declared and paid on October 1. d. The exchange rates were as follows: January 1 April 1 July 1 $ 18,375 52,500 13,125 65,625 262,500 $ 26,250 31,500 131,250 157,500 393,750 183,750 78,750 26,250 39,375 $ 740,250 $ 740,250 P 35.50 35.25 October 1 December 31 P 35.40 35.00 35.30 35.60 Average 2015 20. How much is the cumulative translation adjustment in 2015? a. P 94,500 loss b. Р 94,500 gain c. P114,187.50 loss d. P114,187.50 gain
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