Prepare a Translation worksheet.

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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Translation Consolidation
Worksheet Worksheet
Prepare a Translation worksheet. (Round "Exchange Rate" answers to 3 decimal places. Round your "Dollars" answers to the
nearest whole number. Input all amounts as positive values.)
Account
Sales
Cost of goods sold
Salary expense
Rent expense (adjusted)
Other expenses
Gain on sale of building. 10/1/20
Net income
Retained earnings, 1/1/20
Net income
Dividends
Retained earnings, 12/31/20
Cash and receivables
CAYCE CORPORATION
TRANSLATION WORKSHEET
Inventory
Prepaid expenses (adjusted)
Property, plant, and equipment (net)
Total assets
Accounts payable
Notes payable-due in 2023
Common stock
Additional paid-in capital
Retained earnings, 12/31/20
Subtotal
Cumulative translation adjustment
Total liabilities and equities
Egyptian
Pounds
Exchange U.S. Dollars
Rate
Transcribed Image Text:Translation Consolidation Worksheet Worksheet Prepare a Translation worksheet. (Round "Exchange Rate" answers to 3 decimal places. Round your "Dollars" answers to the nearest whole number. Input all amounts as positive values.) Account Sales Cost of goods sold Salary expense Rent expense (adjusted) Other expenses Gain on sale of building. 10/1/20 Net income Retained earnings, 1/1/20 Net income Dividends Retained earnings, 12/31/20 Cash and receivables CAYCE CORPORATION TRANSLATION WORKSHEET Inventory Prepaid expenses (adjusted) Property, plant, and equipment (net) Total assets Accounts payable Notes payable-due in 2023 Common stock Additional paid-in capital Retained earnings, 12/31/20 Subtotal Cumulative translation adjustment Total liabilities and equities Egyptian Pounds Exchange U.S. Dollars Rate
On January 1, 2019, Cayce Corporation acquired 100 percent of Simbel Company for consideration transferred with a fair value of
$130,500. Cayce is a U.S.-based company headquartered in Buffalo, New York, and Simbel is in Cairo, Egypt. Cayce accounts for its
investment in Simbel under the initial value method. Any excess of fair value of consideration transferred over book value is
attributable to undervalued land on Simbel's books. Simbel had no retained earnings at the date of acquisition. The following are the
2020 financial statements for the two operations. Information for Cayce and for Simbel is in U.S. dollars ($) and Egyptian pounds (£E).
respectively.
Sales
Cost of goods sold
Salary expense
Rent expense
Other expenses
Dividend income-from Simbel
Gain on sale of building, 10/1/20
Net income
Retained earnings, 1/1/20
Net income
Dividends
Retained earnings, 12/31/20
Cash and receivables
Inventory
Prepaid expenses
Investment in Simbel (initial value)
Property, plant, and equipment (net)
Total assets
Accounts payable
Notes payable-due in 2023
Common stock
Additional paid-in capital
Retained earnings, 12/31/20
Total liabilities and equities
Additional Information
January 1, 2019
June 1, 2019
Weighted average rate for 2019
December 31, 2019
June 1, 2020
Cayce
Corporation
$ 209,600
(98,600)
(20,200)
October 1, 2020
Weighted average rate for 2020
December 31, 2020
$ 75,800
$ 324,000
75,800
(30,000)
(7,600)
(22,800)
15,400
$ 369,800
$ 111,400
98,600
30,000
130,500
417,200
$ 787,700
$ 63,200
141,500
126,000
87,200
369,800
$ 787,700
$ 0.300
0.290
0.288
0.280
8.275
8.273
0.274
0.270
Simbel
Company
£E 827,700
(434,500)
(76,400)
(47,200)
(60,800)
8
36,000
£E 244,800
£E 137,800
244,800
(56,000)
. During 2019, the first year of joint operation, Simbel reported income of £E 169,000 earned evenly throughout the year. Simbel
declared a dividend of £E 31,200 to Cayce on June 1 of that year. Simbel also declared the 2020 dividend on June 1.
• On December 9, 2020,Simbel classified a £E 10,000 expenditure as a rent expense, although this payment related to prepayment
of rent for the first few months of 2021.
• The exchange rates for 1 €E are as follows:
£E 326,600
£E 152,600
310,200
8
461,000
EE 923,800
£E 55,800
141,800
246,000
153,600
326,600
£E 923,800
Translate Simbel's 2020 financial statements into U.S. dollars and prepare a consolidation worksheet for Cayce and its Egyptian
subsidiary. Assume that the Egyptian pound is the subsidiary's functional currency.
Transcribed Image Text:On January 1, 2019, Cayce Corporation acquired 100 percent of Simbel Company for consideration transferred with a fair value of $130,500. Cayce is a U.S.-based company headquartered in Buffalo, New York, and Simbel is in Cairo, Egypt. Cayce accounts for its investment in Simbel under the initial value method. Any excess of fair value of consideration transferred over book value is attributable to undervalued land on Simbel's books. Simbel had no retained earnings at the date of acquisition. The following are the 2020 financial statements for the two operations. Information for Cayce and for Simbel is in U.S. dollars ($) and Egyptian pounds (£E). respectively. Sales Cost of goods sold Salary expense Rent expense Other expenses Dividend income-from Simbel Gain on sale of building, 10/1/20 Net income Retained earnings, 1/1/20 Net income Dividends Retained earnings, 12/31/20 Cash and receivables Inventory Prepaid expenses Investment in Simbel (initial value) Property, plant, and equipment (net) Total assets Accounts payable Notes payable-due in 2023 Common stock Additional paid-in capital Retained earnings, 12/31/20 Total liabilities and equities Additional Information January 1, 2019 June 1, 2019 Weighted average rate for 2019 December 31, 2019 June 1, 2020 Cayce Corporation $ 209,600 (98,600) (20,200) October 1, 2020 Weighted average rate for 2020 December 31, 2020 $ 75,800 $ 324,000 75,800 (30,000) (7,600) (22,800) 15,400 $ 369,800 $ 111,400 98,600 30,000 130,500 417,200 $ 787,700 $ 63,200 141,500 126,000 87,200 369,800 $ 787,700 $ 0.300 0.290 0.288 0.280 8.275 8.273 0.274 0.270 Simbel Company £E 827,700 (434,500) (76,400) (47,200) (60,800) 8 36,000 £E 244,800 £E 137,800 244,800 (56,000) . During 2019, the first year of joint operation, Simbel reported income of £E 169,000 earned evenly throughout the year. Simbel declared a dividend of £E 31,200 to Cayce on June 1 of that year. Simbel also declared the 2020 dividend on June 1. • On December 9, 2020,Simbel classified a £E 10,000 expenditure as a rent expense, although this payment related to prepayment of rent for the first few months of 2021. • The exchange rates for 1 €E are as follows: £E 326,600 £E 152,600 310,200 8 461,000 EE 923,800 £E 55,800 141,800 246,000 153,600 326,600 £E 923,800 Translate Simbel's 2020 financial statements into U.S. dollars and prepare a consolidation worksheet for Cayce and its Egyptian subsidiary. Assume that the Egyptian pound is the subsidiary's functional currency.
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