An American Company, on January 2, 2018, acquired all the outstanding common stock of Sam Company, which is located in a country whose currency is the locuro (LC). The locuro is the functional currency of Sam.

For 2018, exchange rates for the locuro were as follows:

	LC1 =
Jan. 2	$0.71
Dec. 31	$0.75
Average for the year	$0.72

Notes: Read carefully and follow strictly so that Bb can grade you correctly! 1. Use comma in numbers, one thousand is 1,000, not 1000. Round to the nearest dollar: 1,000.45 should be 1,000, and 1,000.55 should be 1,001, no decimal points. No $ sign . 2. Use parenthesis ( ) for expenses, accumulated depreciation, dividends, and G/L or adjustments only!

Required: Translate the 2018 financial statements of the subsidiary to U.S. dollars from locuros.

Translation of Financial Statements to U.S. Dollars

For Year Ended December 31, 2018

	Locuros	Exchange Rate	U.S. Dollars
Income Statement
Net sales	630,000		$
Costs and expenses	(435,000)		$
Net income	195,000		$
Statement of Retained Earnings
Retained earnings, beginning of year	220,000		$
Net income	195,000		$
Subtotal	415,000		$
Div declared/paid 12/31/2018	(54,000)		$
Retained earnings, end of year	361,000		$
Balance Sheet
Assets
Current assets	625,000		$
Plant assets (net)	586,000		$
Total assets	1,211,000		$
Liabilities & Stockholders Equity
Current liabilities	238,000		$
Long-term debt	294,000		$
Common stock	120,000		$
Additional paid-in capital	198,000		$
Retained earnings	361,000		$
Translation adjustment			$
Total liabilities & stockholders equity	1,211,000		$