On January 1, Year 4, P Company (a Canadian company) purchased 90% of s Company (located in a foreign country) at a cost of 15,580 foreign currency units (FC). The carrying amounts of S Company's net assets were equal to fair values on this date except for plant and equipment, which had a fair value of FC22,000, with a remaining useful life of 10 years. A goodwill impairment loss of FC 100 occurred evenly throughout Year 4. The following exchange rates were in effect during Year 4: Jan. 1 FC1 = $1.10 Average for year FC1 = $1.16 When ending inventory purchased FC1 = $1.19 Dec. 31 FC1 = $1.22 The statement of financial position of S Company on January 1, Year 4, is as follows: S Company (FC) Plant and equipment (net) 20,000 Inventory 9,100 Monetary assets (current) 11.100 40.200 Ordinary shares 10,000 Retained earnings 3,650 Bonds payable (mature in eight years) 16,000 Current liabilities 10,550 40,200 The December 31, Year 4, financial statements of P Company in $) and S Company (in FC) are shown below: STATEMENT OF FINANCIAL POSITION P Company (S) S Company (FC) Plant and equipment (net) 68,800 18,000 Investment in S Company (at cost) 17,138 Inventory 34,400 12,100 Monetary assets (current) 31,552 19,200 151.890 49.300 Ordinary shares 34,400 10,000 Retained earnings 47,900 9,750 Bonds payable 46,500 16,000 Current monetary liabilities 23,090 13,550 151,890 49,300 INCOME STATEMENT INCOME STATEMENT Sales 411,800 210,000 Dividend income 4,502 Cost of sales (206,400) (132,600) Other expenses (including depreciation) (178,100) (67,200) Profit 31,802 10,200 Dividends were declared on December 31, Year 4, in the amount of $23,200 by P Company and FC4,100 by S Company. Page 698 Required (a) Prepare the December 31, Year 4, consolidated financial statements, assuming that S Company's functional currency is: (i) The Canadian dollar (ii) The foreign currency unit On January 1, Year 4, P Company (a Canadian company) purchased 90% of s Company (located in a foreign country) at a cost of 15,580 foreign currency units (FC). The carrying amounts of S Company's net assets were equal to fair values on this date except for plant and equipment, which had a fair value of FC22,000, with a remaining useful life of 10 years. A goodwill impairment loss of FC 100 occurred evenly throughout Year 4. The following exchange rates were in effect during Year 4: Jan. 1 FC1 = $1.10 Average for year FC1 = $1.16 When ending inventory purchased FC1 = $1.19 Dec. 31 FC1 = $1.22 The statement of financial position of S Company on January 1, Year 4, is as follows: S Company (FC) Plant and equipment (net) 20,000 Inventory 9,100 Monetary assets (current) 11.100 40.200 Ordinary shares 10,000 Retained earnings 3,650 Bonds payable (mature in eight years) 16,000 Current liabilities 10,550 40,200 The December 31, Year 4, financial statements of P Company in $) and S Company (in FC) are shown below: STATEMENT OF FINANCIAL POSITION P Company (S) S Company (FC) Plant and equipment (net) 68,800 18,000 Investment in S Company (at cost) 17,138 Inventory 34,400 12,100 Monetary assets (current) 31,552 19,200 151.890 49.300 Ordinary shares 34,400 10,000 Retained earnings 47,900 9,750 Bonds payable 46,500 16,000 Current monetary liabilities 23,090 13,550 151,890 49,300 INCOME STATEMENT INCOME STATEMENT Sales 411,800 210,000 Dividend income 4,502 Cost of sales (206,400) (132,600) Other expenses (including depreciation) (178,100) (67,200) Profit 31,802 10,200 Dividends were declared on December 31, Year 4, in the amount of $23,200 by P Company and FC4,100 by S Company. Page 698 Required (a) Prepare the December 31, Year 4, consolidated financial statements, assuming that S Company's functional currency is: (i) The Canadian dollar (ii) The foreign currency unit