Gain on sale of building, $10/1/$X$3-0-30,000$

Net income $$72,950$E $231,000$

Retained earnings, $1/1/$X$3$ $$318,000$E $133,000$

Net income $72,950231,000$

Dividends $(24,000)(50,000)$

Retained earnings, $12/31/$X$3$ $$366,950$E$314,000$

Cash and receivables $$110,750$E $146,000$

Inventory $98,000297,000$

Prepaid expenses $30,000-0-$

Investment in Simbel $($initial value$)126,000-0-$

Property, plant, and equipment $($net$)398,000455,000$

Total assets $$762,750$E$898,000$

Accounts payable $$60,800$E $54,000$

Notes payable $-$ due in $20$X$7132,000140,000$

Common stock $120,000240,000$

Additional paid $-$ in capital $83,000150,000$

Retained earnings, $12/31/$X$4366,950314,000$

Total liabilities and equities $$762,750$E$898,000$

Additional Information

During $20$X$3,$ the first year of joint operation, Simbel reported income of $$E $163,000$ earned evenly throughout the year. Simbel declared a dividend of $$E $30,000$ to Acme on June $1$ of that year. Simbel also declared the $20$X$4$ dividend on June $1.$

On December $9,20$X$4,$ Simbel classified a $$E $10,000$ expenditure as a rent expense, although this payment related to prepayment of rent for the first few months of $20$X$5.$

The exchange rates for $1$E are as follows:

January $1,20$X$30\mathrm{.}300$

June $1,20$X$30\mathrm{.}290$

Weighted average rate for $20$X$30\mathrm{.}288$

December $31,20$X$30\mathrm{.}280$

June $1,202$X $0\mathrm{.}275$

October $1,20$X$40\mathrm{.}273$

Weighted average rate for $20$X$40\mathrm{.}274$

December $31,20$X$40\mathrm{.}270$