Assume that your company owns a subsidiary operating in France. The subsidiary conducts most of its business activities in the European Economic Union and maintains its books in the Euro as its functional currency. Following are the subsidiarys financial statements (in ) for the most recent year:

The relevant exchange rates ($:1)are as follows:

Requirement:

Translate the subsidiarys income statement, statement of retained earnings, balance sheet, and statement of cash flows into $US (assume that the BOY Retained Earnings is $553,612). BOY balance of CTA is $314,100.

Income statement: Sales... Cost of goods sold ... Gross profit. .. Operating expenses.. 1,350,000 (810,000) 540,000 (351,000) 189,000 Balance sheet: Assets Cash.. Accounts receivable Inventory... PPE, net. 384,210 313,200 402,300 744, 120 1,843,830 Statement of cash flows: Net income. Change in accounts receivable Change in inventories.. Change in current liabilities Net cash from operating activities 189,000 (52,200) (67,050) 38,160 107,910 Net income. Total assets. Change in PPE, net .. Net cash from investing activities.... (69,120) (69,120) Statement of retained earnings: BOY retained earnings 708,750 Net income 189,000 Dividends (18,900) Ending retained earnings 878,850 Liabilities and stockholders' equity Current liabilities. 228,960 Long-term liabilities. 533,520 Common stock. 90,000 APIC. 112,500 Retained earnings 878,850 Total liabilities and equity. 1,843,830 Change in long-term debt. Dividends .. Net cash from financing activities. ... 88,920 (18,900) 70,020 108,810 Net change in cash. .... Effect of exchange rate on cash Beginning cash. Ending cash 275,400 384,210 BOY rate... EOY rate. Avg. rate... PPE purchase date rate.... LTD borrowing date rate. Dividend rate Historical rate (common stock and APIC). $1.17 $1.22 $1.19 $1.20 $1.20 $1.21 $0.98