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PLEASE HELP WITH THIS 26. Fenwicke Company organized and began operating a subsidiary in a foreign country on January 1, 2015, by investing LCU 40,000.
PLEASE HELP WITH THIS
26. Fenwicke Company organized and began operating a subsidiary in a foreign country on January 1, 2015, by investing LCU 40,000. This subsidiary immediately borrowed LCU 100,000 on a 5-year note with 10 percent interest payable annually beginning on January 1 2016. The sub ad arv t en purchased or LCU 140 000 a bulding that had a 10-year ant cipated ife and no salvage value and is to be depreciated usm? the straight-li e method. Also on Januar 1 the subsidiarv rents the bald n or tree years to a group of local doctors for LCU 5,000 per month. By year-end, payments totaling LCU 50,000 had been received On October 1, LCU 4,000 was paid for a repair made on that date. The subsidiary transferred a cash dividend of LCU 5,000 back to Fenwicke on December 31, 2015 The functional currency for the subsidiary is the LCU. Currency exchange rates for 1 LCU follow: anuary 1, 2015 October 1, 2015 Average for 2015 December 31, 2015 2.00 1 LCU 1.85 = 1 1.90-1 1.80-1 Prepare an income statement, statement of retained earnings, and balance sheet for this subsidiary in LCU and then translate these amounts into U.S. dollarsStep by Step Solution
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