P7.1 LO 1 Translating and Remeasuring Selected Accounts On emeasuring Selected Accounts On January 1, 2019, Safetyway Group, a U.S. company, formed a Swiss subsidiary. TEurope AG. The subs Swiss subsidiary, TEurope AG. The subsidiary issued all of its currently out- standing common stock on that date Selected accounts from its balance sheets on December 31, 2019 and 2020, all of which are shown in Swiss francs (CHF), are as follows: December 31 (in millions) 2020 2019 CHF 35,000 75,000 Accounts receivable, net ............... ........... CHF 40,000 Inventories, at cost..... 80,000 Property, plant and equipment, net of accumulated depreciation of CHF31,000 at December 31, 2020 and CHF14,000 at December 31, 2019. 163,000 Long-term debt .... 100,000 Common stock, 10,000 shares authorized, issued and outstanding 5,000 shares at December 31, 2020 and December 31, 2019... 50,000 150,000 120,000 50,000 Additional information: 1. Exchange rates are as follows: $/CHF $0.96 0.98 1.04 0.99 1.10 January 1, 2019.......... June 2019.... December 31, 2019.............. Average rate for 2019. .................. June 2020.................... July 4, 2020 .................. December 31, 2020 ............ Average rate for 2020.... 1.12 1.13 1.09 2. An analysis of inventories, for which the FIFO inventory method is used, is as follows: 2020 2019 Inventory at beginning of year .. Purchases (June 2020 and June 2019)...... Goods available for sale... Inventory at end of year ...... Cost of goods sold.......... CHF 75,000 335,000 410,000 (80,000) CHF330,000 CHF375,000 375,000 (75,000) CHF300,000 3. On January 1, 2019, TEurope purchased land for CHF24,000 and plant and equipment for CHF140,000. On July 4, 2020, additional equipment was purchased for CHF30,000. Plant and equipment is depreciated on a straight-line basis over a ten-year period with no salvage value. A full year's depreciation is taken in the year of purchase. Required a. Prepare a schedule remeasuring the selected accounts above into U.S. dollars (the functional cur- rency) at December 31, 2020, and December 31, 2019, respectively. Show supporting computations in good form. b. Prepare a schedule translating the selected accounts above into U.S. dollars at December 31, 2020, and December 31, 2019, assuming the Swiss franc is the functional currency