Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2024 with three assets: cash of 23,600 dinars, accounts receivable of 81,100 dinars, and land that cost 211,000 dinars when acquired on April 1, 2023. On January 1, 2024, Zugar has a 161,000 dinar note payable, and no other liabilities. On May 1, 2024, Zugar renders services to a customer for 131,000 dinars, which was immediately paid in cash. On June 1, 2024, Zugar incurred a 111,000 dinar operating expense, which was immediately paid in cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow: April 1, 2023 January 1, 2024 May 1, 2024 June 1, 2024 December 31, 2024 Required: a. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the dinar is the subsidiary's functional currency. What is the translation adjustment for this subsidiary for the year 2024? b. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the U.S. dollar is the subsidiary's functional currency. What is the remeasurement gain or loss for 2024? c. Assume that Zugar is a foreign subsidiary of a U.S. multinational company. On the December 31, 2024, balance sheet, what is the translated value of the Land account? On the December 31, 2024, balance sheet, what is the remeasured value of the Land account? Note: Input all amounts as positive. a. b. Remeasurement gain Translated value of land Remeasured value of land Positive C. C. $ 0.441 dinar 0.471 dinar 0.48 1 dinar 0.50 1 dinar 0.521 dinar translation adjustment $ $ $ $ (15,396) 205 109,720 92,840
Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2024 with three assets: cash of 23,600 dinars, accounts receivable of 81,100 dinars, and land that cost 211,000 dinars when acquired on April 1, 2023. On January 1, 2024, Zugar has a 161,000 dinar note payable, and no other liabilities. On May 1, 2024, Zugar renders services to a customer for 131,000 dinars, which was immediately paid in cash. On June 1, 2024, Zugar incurred a 111,000 dinar operating expense, which was immediately paid in cash. No other transactions occurred during the year. Currency exchange rates for 1 dinar follow: April 1, 2023 January 1, 2024 May 1, 2024 June 1, 2024 December 31, 2024 Required: a. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the dinar is the subsidiary's functional currency. What is the translation adjustment for this subsidiary for the year 2024? b. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the U.S. dollar is the subsidiary's functional currency. What is the remeasurement gain or loss for 2024? c. Assume that Zugar is a foreign subsidiary of a U.S. multinational company. On the December 31, 2024, balance sheet, what is the translated value of the Land account? On the December 31, 2024, balance sheet, what is the remeasured value of the Land account? Note: Input all amounts as positive. a. b. Remeasurement gain Translated value of land Remeasured value of land Positive C. C. $ 0.441 dinar 0.471 dinar 0.48 1 dinar 0.50 1 dinar 0.521 dinar translation adjustment $ $ $ $ (15,396) 205 109,720 92,840
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Zugar Company is domiciled in a country whose currency is the dinar. Zugar begins 2024 with three assets: cash of 23,600 dinars,
accounts receivable of 81,100 dinars, and land that cost 211,000 dinars when acquired on April 1, 2023. On January 1, 2024, Zugar has
a 161,000 dinar note payable, and no other liabilities. On May 1, 2024, Zugar renders services to a customer for 131,000 dinars, which
was immediately paid in cash. On June 1, 2024, Zugar incurred a 111,000 dinar operating expense, which was immediately paid in cash.
No other transactions occurred during the year. Currency exchange rates for 1 dinar follow:
April 1, 2023
January 1, 2024
May 1, 2024
June 1, 2024
December 31, 2024
Required:
a. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume
also that the dinar is the subsidiary's functional currency. What is the translation adjustment for this subsidiary for the year 2024?
b. Assume that Zugar is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume
also that the U.S. dollar is the subsidiary's functional currency. What is the remeasurement gain or loss for 2024?
c. Assume that Zugar is a foreign subsidiary of a U.S. multinational company. On the December 31, 2024, balance sheet, what is the
translated value of the Land account? On the December 31, 2024, balance sheet, what is the remeasured value of the Land
account?
Note: Input all amounts as positive.
a.
b. Remeasurement gain
C.
Translated value of land
Remeasured value of land
Positive
C.
$ 0.441 dinar.
0.471 dinar
0.48 1 dinar
0.50 1 dinar
0.521 dinar
translation adjustment $
$
$
$
(15,396)
205
109,720
92,840
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