ACC5215 Corporate Accounting Assignment Question 3 On 1 July 2034, Strahan Ltd, a company based in Tasmania, Australia, acquired all the issued shares of Bavarian Brewing Ltd (BBL), a German craft beer brewery based in Munich. The trial balance (in Euro) for BBL for the last two years appears below: Cash Accounts receivable Inventory (Opening balance) Land Motor Vehicles Accum. Depn. - Motor Vehicles Machinery Accum. Depn. - Machinery Trademarks Accounts payable Dividends Payable Provisions Loan from Bank of Berlin Ltd Share capital Retained earnings (Opening balance) Dividend paid Dividend declared Sales Purchases Depreciation. Motor Vehicles Depreciation - Machinery Interest Other expenses Income tax expense Y/E 30/06/35 Debit Credit 490,250 76.000 532,000 1,450,000 3,496,000 452,000 2,736,000 480,000 286,000 1,216,000 750,000 1,254,000 1,800,000 2,736,000 750,000 456,000 760,000 6,080,000 3,192,000 152.000 190,000 87.750 1,083,000 551,000 15,538,000 15,538.000 Y/E 30/6/34 Debit Credit 556,000 494,000 456,000 850,000 3,116,000 300,000 2,280,000 290,000 286,000 1,064,000 608,000 2,356,000 2.736,000 646,000 4,940,000 418,000 608,000 2,242,000 114,000 133,000 893,000 494,000 12.940.000 12,940,000 Additional information 1. Sales, purchases, and expenses were occurred evenly throughout the period. 2. Closing inventory on 30 June 2035 was $1,064,000 and was acquired during June 2035. 3. Land was acquired by BBL on 1 October 2034 for $600,000. 4. New motor vehicles were delivered and paid for on 1 April 2035 for $380,000. Each motor vehicle has a useful life of ten years, with no residual value. BBL use straight-line method for all motor vehicles. New machinery assets were delivered and paid for on 31 December 2034 for $456,000. The machinery assets have a useful life of eight years, with no residual value. BBL use straight-line method for all machinery. The interim dividend was paid on 31 December 2034 5. 6. 7. 8. The dividend payable was declared on 30 June 2035 BBL borrowed Euro $1,800,000 on 1 October 2034 at an interest rate of 6.5% per annum, with interest payments at the end of each half-year (i.e., 31 December and 30 June) The exchange rates for the financial year were as follows: Euro = AUD 01-Jul-2034 1.50 01-Oct-2034 1.52 31-Dec-2034 1.55 01-Apr-2035 1.53 30-Jun-2035 1.57 Average June 2035 1.56 Average for 2034-35 1.54 Required 1. Prepare the following financial statements for BBL in Euro for the financial year ended 30 June 2035: A Statement of Profit or Loss A Statement of Changes in Equity (column format) A Statement of Financial Position (current / non-current format) Note: Comparative data are not required 2. Assume that the functional currency for Strahan Ltd is the Australian Dollar (AUD). Prepare a table in which you translate the financial data for BBL to the functional currency. Clearly show all supporting calculations. 3. Prepare the financial statements (as above) for BBL Ltd using the functional currency of AUD. 4. Provide a table in which you determine the opening and closing net monetary assets and verify the foreign currency translation adjustment. ACC5215 Corporate Accounting Assignment Question 3 On 1 July 2034, Strahan Ltd, a company based in Tasmania, Australia, acquired all the issued shares of Bavarian Brewing Ltd (BBL), a German craft beer brewery based in Munich. The trial balance (in Euro) for BBL for the last two years appears below: Cash Accounts receivable Inventory (Opening balance) Land Motor Vehicles Accum. Depn. - Motor Vehicles Machinery Accum. Depn. - Machinery Trademarks Accounts payable Dividends Payable Provisions Loan from Bank of Berlin Ltd Share capital Retained earnings (Opening balance) Dividend paid Dividend declared Sales Purchases Depreciation. Motor Vehicles Depreciation - Machinery Interest Other expenses Income tax expense Y/E 30/06/35 Debit Credit 490,250 76.000 532,000 1,450,000 3,496,000 452,000 2,736,000 480,000 286,000 1,216,000 750,000 1,254,000 1,800,000 2,736,000 750,000 456,000 760,000 6,080,000 3,192,000 152.000 190,000 87.750 1,083,000 551,000 15,538,000 15,538.000 Y/E 30/6/34 Debit Credit 556,000 494,000 456,000 850,000 3,116,000 300,000 2,280,000 290,000 286,000 1,064,000 608,000 2,356,000 2.736,000 646,000 4,940,000 418,000 608,000 2,242,000 114,000 133,000 893,000 494,000 12.940.000 12,940,000 Additional information 1. Sales, purchases, and expenses were occurred evenly throughout the period. 2. Closing inventory on 30 June 2035 was $1,064,000 and was acquired during June 2035. 3. Land was acquired by BBL on 1 October 2034 for $600,000. 4. New motor vehicles were delivered and paid for on 1 April 2035 for $380,000. Each motor vehicle has a useful life of ten years, with no residual value. BBL use straight-line method for all motor vehicles. New machinery assets were delivered and paid for on 31 December 2034 for $456,000. The machinery assets have a useful life of eight years, with no residual value. BBL use straight-line method for all machinery. The interim dividend was paid on 31 December 2034 5. 6. 7. 8. The dividend payable was declared on 30 June 2035 BBL borrowed Euro $1,800,000 on 1 October 2034 at an interest rate of 6.5% per annum, with interest payments at the end of each half-year (i.e., 31 December and 30 June) The exchange rates for the financial year were as follows: Euro = AUD 01-Jul-2034 1.50 01-Oct-2034 1.52 31-Dec-2034 1.55 01-Apr-2035 1.53 30-Jun-2035 1.57 Average June 2035 1.56 Average for 2034-35 1.54 Required 1. Prepare the following financial statements for BBL in Euro for the financial year ended 30 June 2035: A Statement of Profit or Loss A Statement of Changes in Equity (column format) A Statement of Financial Position (current / non-current format) Note: Comparative data are not required 2. Assume that the functional currency for Strahan Ltd is the Australian Dollar (AUD). Prepare a table in which you translate the financial data for BBL to the functional currency. Clearly show all supporting calculations. 3. Prepare the financial statements (as above) for BBL Ltd using the functional currency of AUD. 4. Provide a table in which you determine the opening and closing net monetary assets and verify the foreign currency translation adjustment