On January 1, 20X1, Popular Creek Corporation organized SunTime Company as a subsidiary in Switzerland with an initial investment cost of Swiss francs (SFr) 65,000. SunTimes December 31, 20X1, trial balance in SFr is as follows:

	Debit				Credit
Cash	SFr	8,100
Accounts Receivable (net)		23,500
Receivable from Popular Creek		6,800
Inventory		29,000
Plant & Equipment		107,000
Accumulated Depreciation					SFr	10,300
Accounts Payable						12,600
Bonds Payable						54,500
Common Stock						65,000
Sales						166,300
Cost of Goods Sold		73,500
Depreciation Expense		10,300
Operating Expense		33,500
Dividends Paid		17,000
Total	SFr	308,700			SFr	308,700

Additional Information

1. The receivable from Popular Creek is denominated in Swiss francs. Popular Creek's books show a $5,800 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 years 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:

	SFr		$
January 1	1	=	0.73
March 1	1	=	0.74
November 1	1	=	0.77
December 31	1	=	0.80
20X1 average	1	=	0.75

6. The Swiss franc is the functional currency.

Required: a. Prepare a proof of the translation adjustment.

Popular creek corp and subsidiary

proof of translation adjustment

year ended December 31, 20x1

Net assets at beginning of the year

adjustment for changes in net asset position during the year

net income for the 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 adjustments Dec 31

Stuff Company is a subsidiary of Pland Corporation and is located in Madrid, Spain, where the currency is the euro (). Data on Stuffs inventory and purchases are as follows:

Inventory, January 1, 20X7		232,000
Purchases during 20X7		864,000
Inventory, December 31, 20X7		189,000

The beginning inventory was acquired during the fourth quarter of 20X6, and the ending inventory was acquired during the fourth quarter of 20X7. Purchases were made evenly over the year. Exchange rates were as follows:

			$
Fourth quarter of 20X6	1	=	1.29015
January 1, 20X7	1	=	1.32030
Average during 20X7	1	=	1.39655
Fourth quarter of 20X7	1	=	1.45000
December 31, 20X7	1	=	1.47280

Required: a. Show the remeasurement of cost of goods sold for 20X7, assuming that the U.S. dollar is the functional currency. (Round your intermediate calculations and final answer to nearest dollar amount.)

cost of goods sold

b. Show the translation of cost of goods sold for 20X7, assuming that the euro is the functional currency. (Round your final answer to nearest dollar amount.)

cost of goods sold