Exercise 13-4

On January 1, 2014, Trenten Systems, a U.S.-based company, purchased a controlling interest in Grant Management Consultants located in Zurich, Switzerland. The acquisition was treated as a purchase transaction. The 2014 financial statements stated in Swiss francs are given below.

GRANT MANAGEMENT CONSULTANTS Comparative Balance Sheets January 1 and December 31, 2014
		Jan. 1		Dec. 31
Cash and Receivables		19,600		54,400
Net Property, Plant, and Equipment		40,200		37,600
Totals		59,800		92,000
Accounts and Notes Payable		29,500		32,200
Common Stock		19,600		19,600
Retained Earnings		10,700		40,200
Totals		59,800		92,000

GRANT MANAGEMENT CONSULTANTS Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2014
Revenues		74,900
Operating Expenses including Depreciation of 2,600 francs		30,600
Net Income		44,300
Dividends Declared and Paid		14,800
Increase in Retained Earnings		29,500

Direct exchange rates for Swiss franc are:

		Dollars per Franc
January 1, 2014		$0.5987
December 31, 2014		0.5321
Average for 2014		0.5654
Dividend declaration and payment date		0.5810

(a) Translate the year-end balance sheet and income statement of the foreign subsidiary using the current rate method of translation. (Round answers to 0 decimal places, e.g. 5,125. Enter loss and debit cumulative translation adjustment using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).)

Increase in Retained Earnings 29,500 Direct exchange rates for Swiss Franc are: January 1, 2014 December 31, 2014 Average for 2014 Dividend declaration and payment date $0.5987 0.5321 0.5654 0.5810 (a) Translate the year-end balance sheet and income statement of the foreign subsidiary using the current rate method of translation. (Round answers to 0 decir eg. (2,945).) Translation Francs Consolidated Income and Retained Earnings Statement V LA Balance Sheet Total Total SHOW LIST OF ACCOUNTS LINK TO TEXT (6) The parts of the question must be completed in order Thiebart be available when you complete the part above ype here to search