Assume that Goss has a subsidiary company based in Japan. Requirements 1. Translate into dollars the foreign-currency
Question:
Requirements
1. Translate into dollars the foreign-currency balance sheet of the Japanese subsidiary of Goss.
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When Goss acquired this subsidiary, the Japanese yen was worth $0.0092. The current exchange rate is $0.0107. During the period when the subsidiary earned its income, the average exchange rate was $0.0095 per yen. Before you perform the foreign-currency translation calculations, indicate whether Goss has experienced a positive or a negative translation adjustment.
State whether the adjustment is a gain or a loss, and show where it is reported in the financial statements.
2. To which company does the foreign-currency translation adjustment €œbelong€? In which company€™s financial statements will the translation adjustment bereported?
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...
Step by Step Answer:
Req 1 This situation will generate a positive translation adjustment which ...View the full answer
Financial accounting
ISBN: 978-0132751124
9th edition
Authors: Walter T. Harrison Jr., Charles T. Horngren, C. William Thom
