By the year $2024,$ Garfield's lasagnas have become popular in many countries outside of

Canada. Due to the high demand for lasagna in Switzerland and costly shipping methods,

Garfield Inc. purchased a subsidiary in Switzerland. On January $1,2024,$ Garfield Inc. acquired

$40\%$ of Odie Ltd$.\text{'}$s common shares for $850,000CHF.$

The following are the financial statements of Odie Ltd$,$ as at December $31,2024$:

Balance Sheet

Cash

Accounts receivable

Inventories $-$ at cost

Land

Buildings

Accumulated depreciation

Equipment

Accumulated depreciation

Accounts payable

Miscellaneous payables

Bonds payable

Common shares

Retained earnings

Retained Earnings Statement

Balance, January $1$

Net income

Dividends

Balance, December $31$

Income Statement

Sales

Cost of sales

Other expenses

Total expenses

Net income

Exchange rates during the year were:

January $1,2024$

December $31,2024$

Average for $2024$

$$1CDN=,4\mathrm{.}25CHF$

$$1CDN=4\mathrm{.}75CHF$

$$1CDN=3\mathrm{.}95CHF$

The land and buildings were purchased in $2020$ when the exchange rate was $3\mathrm{.}8$ CHF$.$

During $2024,$ equipment costing $150,000$ CHF was purchased for cash. Depreciation

totalling $25,000$ CHF was recorded on this equipment. The exchange rate on the date of

the equipment purchase was S$.$OS CHF$.$ The remaining equipment was purchased in

$2021$ when the exchange rate was $3\mathrm{.}88CHF.$

Depreciation on the buildings of $75,000$ CHF and depreciation on the equipment of

$65,000CHF$ are included in ather expenses on the income statement.

The December $31,2024,$ inventory was acquired during the last quarter of the year,

when the average exchange rate was $4\mathrm{.}95$ CHF$.$

On January $1,2024,$ imventory was $500,000$ CHF and was acquired when the average

exchange rate was $5\mathrm{.}25$ CHF$.$

The bonds payable were issued on January $1,2019$ when the exchange rate was $3\mathrm{.}85$

CHF and will mature on December $31,2029.$

Other aperating expenses were incurred equally throughout the year.

Dividends were declared and paid on December $31,2024.$

On January $1,2024,$ liabilities were greater than monetary assets by $810,000CHF.$

The common shares were issued on January $1,2018,$ when the exchange rate was $3\mathrm{.}5$

CHF$.$

Required:

A$)$ Assume that Odie Ltd$.\text{'}$s functional currency is the Canadian dollar. Translate the

financial statements into Canadian dollars using the FCT method.

B$)$ Assume that Odie Ltd$.\text{'}$s functional currency is the Swiss Franc. Translate the financial

statements into Canadian dollars using the PCT method.

C$)$ Name two accounts that exist in your financial statements under the PCT method that

do not exist under the FCT methad.By the year $2024,$ Garfield$$s lasagnas have become popular in many countries outside of Canada. Due to the high demand for lasagna in Switzerland and costly shipping methods, Garfield Inc. purchased a subsidiary in Switzerland. On January $1,2024,$ Garfield Inc. acquired $40\%$ of Odie Ltd$.$s common shares for $850,000$ CHF$.$

The following are the financial statements of Odie Ltd$,$ as at December $31,2024$: