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On January 1, 20X1, Popular Creek Corporation organized RoadTime Company as a subsidiary in Switzerland with an initial investment cost of Swiss francs (SFr) 62,000.
On January 1, 20X1, Popular Creek Corporation organized RoadTime Company as a subsidiary in Switzerland with an initial investment cost of Swiss francs (SFr) 62,000. RoadTime's December 31, 20X1, trial balance in SFr is as follows: Debit Credit Cash Accounts Receivable (net) Receivable from Popular Creek Inventory Plant & Equipment Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Sales Cost of Goods Sold Depreciation Expense Operating Expense Dividends Paid SFr 7,300 22,500 6,200 27,000 108,000 SFr 10,500 13,900 53,500 62,000 161,300 71,500 10,500 32,000 16,200 Total SFr301,200 SFr301,200 Additional Information 1. The receivable from Popular Creek is denominated in Swiss francs. Popular Creek's books show a $4,960 payable to RoadTime 2. Purchases of inventory goods are made evenly during the year. Items in the ending inventory were purchased November 1 3. Equipment is depreciated by the straight-line method with a 10-year life and no residual value. A full year's depreciation is taken in the year of acquisition. The equipment was acquired on March 1 4. The dividends were declared and paid on November 1 5. Exchange rates were as follows January 1 March 1 November 1 December 31 20X1 average SFr $ 1 = 0.73 1 = 0.74 1 = 0.77 1 = 0.80 1 0.75 6. The Swiss franc is the functional currency
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