FOREIGN TRANSACTIONS

Quadros Inc., a Portugese firm was acquired by a U.S. company on January 1, 2023. Selected account balances are available for the year ended December 31, 2023, and are stated in euro, the local currency.

Sales EURO 400,000Inventory at cost (bought on February 1, 2023) 20,000Equipment (bought on January 1, 2018) 90,000Dividends (paid on September 1, 2023) 20,000Accumulated Depreciation Equipment (balance at 12/31/23) 45,000Depreciation Expense on Equipment (for the year ended 12/31/23) 9,000

Relevant exchange rates for 1 euro are given below:

January 1, 2018 $ 0.91January 1, 2019 $ 0.92January 1, 2023 $ 0.93February 1, 2023 $ 0.94September 1, 2023 $ 0.97December 31, 2023 $ 1.01Average for year, 2023 $ 0.95

(Example of Answer 100,000 X 1.00 = $100,000)

1) Assume the functional currency is the euro, compute the U.S. income statement amount for sales for 2023.

2)Assume the functional currency is the euro, compute the U.S. balance sheet amount for inventory, at cost, at December 31, 2023.

3) Assume the functional currency is the euro, compute the U.S. balance sheet amount for equipment for 2023.

4)Assume the functional currency is the euro, compute the U.S. statement of retained earnings amount for dividends for 2023.

5)Assume the functional currency is the euro, compute the U.S. balance sheet amount for accumulated depreciation for 2023.

6)Assume the functional currency is the euro, compute the U.S. income statement amount for depreciation expense for 2023.

7)Assume the functional currency is the U.S. dollar, compute the U.S. income statement amount for sales for 2023.

8)Assume the functional currency is the U.S. dollar, compute the U.S. balance sheet amount for inventory, at cost, for 2023.

9)Assume the functional currency is the U.S. dollar, compute the U.S. balance sheet amount for equipment for 2023.

10)Assume the functional currency is the U.S. dollar, compute the U.S. statement of retained earnings amount for dividends for 2023.

11)Assume the functional currency is the U.S. dollar, compute the U.S. balance sheet amount for accumulated depreciation for 2023.

12)Assume the functional currency is the U.S. dollar, compute the U.S. income statement amount for depreciation expense for 2023.