Assume that Lundgren Corporation has a subsidiary company based in Japan Yen Assets 410,000,000 Liabilities 115,000,000 Stockholders ' equity Common stock 35,000,000 Retained earnings 260,000,000 410,000,000 Requirement 1 Translate into dollars the foreign currency balance sheet of the Japanese sub...

Req 1 This situation will generate a positive translation adjustment which is like a gain The gain o ...

Assume that Lundgren Corporation has a subsidiary company based in Japan? Yen Assets ........................... 410,000,000 Liabilities .......................

Question:

Assume that Lundgren has a subsidiary company based in Japan?
Yen
Assets ........................... ¥410,000,000
Liabilities ....................... ¥115,000,000
Stockholders' equity:
................ 35,000,000
Retained earnings ............ 260,000,000
¥410,000,000
Requirement
1. Translate into dollars the foreign-currency of the Japanese subsidiary of Lundgren. When Lundgren acquired this subsidiary, the Japanese yen was worth $0.0095. The current is $0.0110. During the period when the subsidiary earned its income, the average was $0.0100 per yen. Before you perform the foreign-currency translation calculations, indicate whether Lundgren 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 To which company does the foreign-currency translation adjustment "belong"? In which company's will the translation adjustment be reported?
Financial Statements
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... Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... 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... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... 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...