On January 1, 20X1. Popular Creek Corporation organized SunTime Company as a subsidiary in Switzerland with an Indal Investment cost of Swiss francs (SFr) 75.000. SunTime's December 31, 20X1, trial balance in SFr is as follows: Credit Debit SFr 7,400 20,5ee 5,800 27,000 1es,eee Cash Accounts Receivable (net) Receivable from Popular Creek Inventory Plant & Equipment Accumulated Depreciation Accounts Payable Bonds Payable Connon Stock Sales Cost of Goods Sold Depreciation Expense Operating Expense Dividends Paid Total SFr 12,eee 13, 120 58,5ee 75, eee 145, Bee 71,eee 12.ee 31,5ee 16, 2ee SFr 296,400 SFr 296,480 Additional Information 1. The receivable from Popular Creek is denominated in Swiss francs. Popular Creek's books show a 54,800 payable to SunTime. 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 2ex1 average SFr $ 1=0.73 1 = 0.74 1=0.77 1 = 0.88 1 = 0.75 6. The Swiss franc is the functional currency. Required: a. Prepare a proof of the translation adjustment. POPULAR CREEK CORPORATION AND SUBSIDIARY Proof of Translation Adjustment Year Ended December 31, 20X1 U.S Dollars Net assets at beginning of year Adjustment for changes in net asset position during year: Net income for year Dividends paid Net assets translated at: Rates during year Rates at end of year Change in other comprehensive income translation adjustment during year net increase Accumulated other comprehensive income translation adjustment January 1 Change in other comprehensive income translation adjustment December 31 0 0 $ 0