12-4 Multiple-Choice Questions on Translation and Remeasurement Use the following information for questions 1,2 , and 3 . Bartell Inc., a U.S. company, acquired 90 percent of the common stock of a Malaysian company on January 1, 20X5, for $160,000. The net assets of the Malaysian subsidiary amounted to 680,000 ringgit (RM) on the date of acquisition. On January 1, 20X5, the book values of the Malaysian subsidiary's identifiable assets and liabilities approximated their fair values. Exchange rates at Bastell? a. $17,200 b1,3.51,460 1=511401 4. 325,360 2. Refer to the proceding exchange nate tatormistion A Acume that Bartell acquired $10,500 of goodwill on January 1,205, and the good will suffered a 10 percect itrpaitment loss in 205, be reported an Bariell's convotidaced ingone statement for 205 ? a. 51,050 b. 31,20x c. 31,100 af $1,175 3. Fefer wa the preceding iaformation. but now asparne that whe L S. Sollar is the fuectional currency. How midch goodwill impairment loss should be reported on Bartells consolidated income tatement in this situration? a. 81,050 b. \$1.200 c. 51.110) I. 51.175 Use the folloning infocmation foe questions 4,5,6, and 7 : pany on January 1, 20X5, for 5402000 , The Corman sobsidiary's net assets ainotanted to +300,0000 on the date of acquisition. On Janaary 1. 20x5. the beot values of its idecitifiahle arsets and liabetities approximatod their fair valocs. As it resalt of an analysin of functicnal curcency inchcators, Mondelt determined that the cute was the fusctional carrency. Dr Dovember 31, 20K5. the Getman subsidiary's adjusied trial balance, translited into U.S. dollars, contained \$12.0000 more debite than crodits. The German cubcidiary reported income of +25, 000 for a0x. 2 and paid a cabli dividend of E5.000 on November 30. 206. Includod on the German subsidary's incocne umement was denneciation expense of 22,000 . Mondell uses the fully adjused equity titethod of acoovintithg tor its investmeet in the Grrman subsidiary and dotermined that goodwill it the first year had as impairment tors of 10 percent of its initial amount. Exchar get rates at varwows dates diring 20x s follow- 4. Refer to the precediag ieformatioa. Wist amount shoald Mondell record as incime from sab. (1. $31,000 t. $26,660 f. 533,000 a. 528,600 5. Refer to tbe precedine inforrtution. The teceipt of the dividead will restain in 4. A credit to the invesimeti account for $6,200. b. A delvit to the incoma from subvidiary account for $6,600. c. A credit to the invettens account for 56.600. d. A credit to the inverimat accoant for 56500 . 6. Refer to the preceding information. On Mondell's consolidated balance sheet at December 31, 205, what amount should be reported for the goodwill acquired on January 1,20X5? a. $37,660 b. $37,800 c. $41,580 d. $39,880 7. Refer to the preceding information. In the stockholders' equity section of Mondell's consolidated balance sheet at December 31, 20X5, Mondell should report the translation adjustment as a component of other comprehensive income of a. $12,000 b. $15,920 c. $13,400 d. $8,080
