Assume that Mason has a subsidiary company based in Japan.

Requirements
1. Translate into dollars the foreign-currency balance sheet of the Japanese subsidiary of Mason.
Yen
Assets...................................... 410,000,000
Liabilities................................ 100,000,000
Stockholders equity:
Common stock.................... 18,000,000
Retained earnings................ 292,000,000
410,000,000
When Mason acquired this subsidiary, the Japanese yen was worth $0.0075. The current exchange rate is $0.0090. During the period when the subsidiary earned its income, the average exchange rate was $0.0088 per yen. Before you perform the foreign-currency translation calculations, indicate whether Mason 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 belong? In which company’s financial statements will the translation adjustment be reported?