Yang Corporation starts a foreign subsidiary on January 1 by investing 44,000 rand. Yang owns all of the shares of the subsidiary's common stock. The foreign subsidiary generates 88,000 rand of net income throughout the year and pays no dividends. The rand is the foreign subsidiary's functional currency. Currency exchange rates for 1 rand are as follows: January 1 Average for the year December 31 Required: $ 0.25 = 1 rand 0.28 1 rand 0.31 1 rand B In preparing consolidated financial statements, determine the translation adjustment that Yang Corporation will report at the end of the current year. Translation adjustment

SWFT Comprehensive Volume 2019
42nd Edition
ISBN:9780357233306
Author:Maloney
Publisher:Maloney
Chapter25: Taxation Of International Transactions
Section: Chapter Questions
Problem 25P
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Yang Corporation starts a foreign subsidiary on January 1 by investing 44,000 rand. Yang owns all of the shares of the subsidiary's
common stock. The foreign subsidiary generates 88,000 rand of net income throughout the year and pays no dividends. The rand is
the foreign subsidiary's functional currency. Currency exchange rates for 1 rand are as follows:
January 1
Average for the year
December 31
Required:
$ 0.25 = 1 rand
0.28 1 rand
0.31 1 rand
B
In preparing consolidated financial statements, determine the translation adjustment that Yang Corporation will report at the end of the
current year.
Translation adjustment
Transcribed Image Text:Yang Corporation starts a foreign subsidiary on January 1 by investing 44,000 rand. Yang owns all of the shares of the subsidiary's common stock. The foreign subsidiary generates 88,000 rand of net income throughout the year and pays no dividends. The rand is the foreign subsidiary's functional currency. Currency exchange rates for 1 rand are as follows: January 1 Average for the year December 31 Required: $ 0.25 = 1 rand 0.28 1 rand 0.31 1 rand B In preparing consolidated financial statements, determine the translation adjustment that Yang Corporation will report at the end of the current year. Translation adjustment
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