Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Diekmann Company, a U.S.based company, acquired a 100 percent interest in Rakona A.S. in the Czech Republic on January 1, 2019. when the exchange rate

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Diekmann Company, a U.S.based company, acquired a 100 percent interest in Rakona A.S. in the Czech Republic on January 1, 2019. when the exchange rate for the Czech koruna (Ks) was \$0.05, Rakona's financlal statements as of December 31, 2020, two years later, follow: Additional information - The January 1,2020, beginning inventory of Kcs,6,000,000 was acquired on December 18, 2019, when the exchange rate was $0.043. Purchases of inventory were acquired uniformly dunng 2020. The December 31,2020, ending inventory or Kcs 8,500,000 was acquired in the latter part of 2020 when the exchange rate was $0.032. All depreciable assets (equipment and bulidings) were on the books when the subsidiary was acquired-except for Kc s 5,000,000 of equipment acquired on January 3,2020 , when the exchange rate was $0.036, and Ks 12,000,000 in buldings acquired on March 5,2020, when the exchange rate was $0.034. Straight-line depreciation is 10 years for equipment and 40 years for bulidings. A full year's depreciation is taken in the year of acquistion. - Dividends were deciared and pald on December 15,2020 , when the exchange rate was $0.031 - Other exchanqe rates for 1KC cs follow: - The January 1, 2020, beginning Inventory of Kcs6,000,000 was acquired on December 18,2019 , when the exchange rate was $0.043. Purchases of inventory were acquired unformly during 2020. The December 31,2020 , ending inventory of Kcs8,500,000 was acquired in the latter part or 2020 when the exchange rate was $0.032. All depreclable assets (equipment and bulldings) were on the books when the subsidiary was acquired-except for Ks 5,000,000 of equipment acquired on January 3,2020, when the exchange rate was $0.036, and Ks 12,000,000 in bulldings acquired on March 5, 2020, when the exchange rate was $0.034 Straight-line depreciation is 10 years for equipment and 40 years for bulldings. A full year's depreciation is taken in the year of acquisition. - Dividends were declared and paid on December 15, 2020, when the exchange rate was $0.031. - Other exchange rates for 1Kc cs follow: Translate the Czech koruna financial statements at December 31,2020 , in the following three situations: a. The Czech koruna is the functional currency. The December 31, 2019, US dollar-translated balance sheet reported retained earnings of $22,500. The December 31, 2019, cumulative translation adjustment was negative $202,500 (debit balance) b. The U.S. dollar is the functional currency. The December 31,2019, U.S. dollar-remeasured balance sheet reported retained earnings (Including a 2019 remeasurement gain) of $353,000 c. The U.S, dollar is the functional currency. Rakona has no long-term debt instead, it has common stock of Ks 20,000,000 and additional paid-In capital of Ks 50,000,000. The December 31, 2019, US dollar-remeasured balance sheet reported a negative balance in retained earnings of $147.000 (including a 2019 remeasurement loss). Answer is not complete. Complete this question by entering your answers in the tabs below. Translate the Czech koruna financial statements at December 31, 2020 assuming the Czech koruna is the functional currency. The December 31, 2019, U.S. dollar-translated balance sheet reported retained eamings of $22,500. The December 31 , 2019 , cumulative translation adjustment was negative $202,500 (debit balance). (Amounts to be deducted and negative amounts should be indicated with a minus sign.) c. The US. dollor is the functional currency. Rokona has no long-term debt, Insteod, it has common stock of Kcs 20,000,000 and additional poid-in copital of Ks 50,000,000. The December 31, 2019. U.S dollor-eemeosured bolonce sheet reported o negative belance in retained earnings of $147,000 (including a 2019 remeosurement losit) Answer is not complete. Complete this question by entering your answers in the tabs below. Transtate the Crech koruna financial statements at December 31, 2020 assuming the Cuco ksona as the Runctional currency. ambunts should be indicated with a minus sign.) Answer is not complete. Complete this question by entering your answers in the tabs below. Traristate the Crech koruna financial statements at December 31,2020 assuming the U.S, dotar is the functionat currency. The December 31, 2019, US. dollar-remeasured balance sheet reported retained eamings (including a 2019 remeasurement gain) of $353,000. (Amounts to be deducted and negallve amounts should be indicated with a minus sign.) Answer is not complete. Complete this question by entering your answers in the tabs below. Transiste the Crech koruna financial statements at December 31, 2020 astuming the US. dellar is the functional currency Ravona has ne long-term debt. Instead, R has common stock of kBs 20,000,000 and astetional paid-in capital of KRS of $147,000 (induding a 2019 remeasurement loss). (Amourts tis be dedudted and negetive amounts should be indicated wen a minus sign.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction To Accounting

Authors: Peter Scott

2nd Edition

0198849966, 978-0198849964

More Books

Students also viewed these Accounting questions

Question

State the uses of job description.

Answered: 1 week ago

Question

Explain in detail the different methods of performance appraisal .

Answered: 1 week ago

Question

Contrast intelligence and emotional intelligence.

Answered: 1 week ago

Question

Briefly describe four guides to ethical decision-making

Answered: 1 week ago