Problem 13-2 On January 1, 2014, U.S. company purchased 100% of the outstanding stock of Ventana Grains, a company located in Latz City, New Zealand. Ventana Grain was oraired on January 1, 2000. All the property, plant, and equipment held on January 1, 2014, was acquired when the company was organized. The business combination was accounted for as a purchase transaction. The 2014 financial statements for Ventana Grains, prepared in its local currency, the New Zealand are given here. VENTANA GRAINS Comparative Balance Sheets January 1 and December 31, 2014 Dec Cash and Recorables 500,000 873,000 Inventory 600,000 502,000 Land 396,000 396,000 Buildings (net) 647,000 602.000 Equipment (net) 467,000 165,000 Totals 2,610,000 2,841,000 Short-term Accounts and No 299.000 on January 1, 2014, a 0.5. company purchaseu 100% or the outsta 2000. All the property, plant, and equipment held on January 1, 201 2014 financial statements for Ventana Grains, prepared in its local VENTANA GRAINS Comparative Balance Sheets January 1 and December 31, 2014 Jan. 1 Dec. 31 Cash and Receivables 500,000 873,000 Inventory 600,000 502,000 Land 396,000 396,000 Buildings (net) 647,000 602,000 Equipment (net) 467,000 468,000 Totals 2,610,000 2,841,000 Short-Term Accounts and Notes 298,000 212,000 Long-Term Notes (602,000 issued September 1, 2006, 78,000 issued July 1, 2014) 602,000 680,000 Common Stock 800,000 800,000 Additional Paid-in Capital 200,000 200,000 Retained Earnings 710,000 949,000 Total 2,610,000 2,841,000 VENTANA GRAINS Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2014 Revenues 3,233,000 Cost of Goods Sold: Beginning Inventory 600,000 Purchases 2,091,000 non VENTANA GRAINS Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2014 Revenues 3,233,000 Cost of Goods Sold: Beginning Inventory 600,000 Purchases 2,091,000 Goods Available for Sale 2,691,000 Less: Ending Inventory 502,000 Cost of Goods Sold 2,189,000 Gross Profit on Sales 1,044,000 Depreciation Expense 140,000 Other Expenses 537,000 677,000 Net Income 367,000 Jan. 1 Retained Earnings 710,000 Total 1,077,000 Less: Dividends Paid 128,000 Dec. 31 Retained Earnings 949,000 The account balances are computed in conformity with U.S. generally accepted accounting standards. Other information is as follows: 1. Direct exchange rates for the New Zealand dollar on various dates were: Date Exchange Rate January 1, 2000 $0.8011 September 1, 2010 0.5813 January 1, 2014 0.7924 July 1, 2014 0.7412 SALE HE STRUCT WUL PRINTERE Other information is as follows: 1. Direct exchange rates for the New Zealand dollar on various dates were: Exchange Rate January 1, 2000 30.8011 September 1, 2010 0.5813 January 1, 2014 0.7924 July 1, 2014 0.7412 December 31, 2014 0.7298 Average for 2014 0.7480 Avenge for the last four months of 2014 0.7476 2. Ventana Grans purchased additional equipment for 96,000 New Zealand dollars on July 1, 2014, by issuing a note for 78,000 New Zealand dollars and paying the balance in cash 3. Sales were made and purchases and other Expenses were incurred evenly throughout the year 4. Depreciation for the period in New Zealand dollars was computed as follows: Building 45,000 Equipment Purchased before 1/1/2014 85.400 Louipment --Purchased July 1, 2014 9,600 5. The inventory is valued on a firo basis. The beginning inventory was actured when the exchange rate was $0.7480. The ending stiventory was acquired during the last four months of 201 6. Dividends of 64,000 New Zealand dollars were paid on July 1 and December 31 (b) Prepare a schedule to verify the translation gain or loss determined in parta. Describe how the translation gain or loss would be reported in the financial statements (Round answers to decimal places, c. 5,125. Enter loss using either a negative siga preceding the number .. 2,945 or parentheses ed. (2,945).) Zealand Problem 13-2 On January 1, 2014, U.S. company purchased 100% of the outstanding stock of Ventana Grains, a company located in Latz City, New Zealand. Ventana Grain was oraired on January 1, 2000. All the property, plant, and equipment held on January 1, 2014, was acquired when the company was organized. The business combination was accounted for as a purchase transaction. The 2014 financial statements for Ventana Grains, prepared in its local currency, the New Zealand are given here. VENTANA GRAINS Comparative Balance Sheets January 1 and December 31, 2014 Dec Cash and Recorables 500,000 873,000 Inventory 600,000 502,000 Land 396,000 396,000 Buildings (net) 647,000 602.000 Equipment (net) 467,000 165,000 Totals 2,610,000 2,841,000 Short-term Accounts and No 299.000 on January 1, 2014, a 0.5. company purchaseu 100% or the outsta 2000. All the property, plant, and equipment held on January 1, 201 2014 financial statements for Ventana Grains, prepared in its local VENTANA GRAINS Comparative Balance Sheets January 1 and December 31, 2014 Jan. 1 Dec. 31 Cash and Receivables 500,000 873,000 Inventory 600,000 502,000 Land 396,000 396,000 Buildings (net) 647,000 602,000 Equipment (net) 467,000 468,000 Totals 2,610,000 2,841,000 Short-Term Accounts and Notes 298,000 212,000 Long-Term Notes (602,000 issued September 1, 2006, 78,000 issued July 1, 2014) 602,000 680,000 Common Stock 800,000 800,000 Additional Paid-in Capital 200,000 200,000 Retained Earnings 710,000 949,000 Total 2,610,000 2,841,000 VENTANA GRAINS Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2014 Revenues 3,233,000 Cost of Goods Sold: Beginning Inventory 600,000 Purchases 2,091,000 non VENTANA GRAINS Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2014 Revenues 3,233,000 Cost of Goods Sold: Beginning Inventory 600,000 Purchases 2,091,000 Goods Available for Sale 2,691,000 Less: Ending Inventory 502,000 Cost of Goods Sold 2,189,000 Gross Profit on Sales 1,044,000 Depreciation Expense 140,000 Other Expenses 537,000 677,000 Net Income 367,000 Jan. 1 Retained Earnings 710,000 Total 1,077,000 Less: Dividends Paid 128,000 Dec. 31 Retained Earnings 949,000 The account balances are computed in conformity with U.S. generally accepted accounting standards. Other information is as follows: 1. Direct exchange rates for the New Zealand dollar on various dates were: Date Exchange Rate January 1, 2000 $0.8011 September 1, 2010 0.5813 January 1, 2014 0.7924 July 1, 2014 0.7412 SALE HE STRUCT WUL PRINTERE Other information is as follows: 1. Direct exchange rates for the New Zealand dollar on various dates were: Exchange Rate January 1, 2000 30.8011 September 1, 2010 0.5813 January 1, 2014 0.7924 July 1, 2014 0.7412 December 31, 2014 0.7298 Average for 2014 0.7480 Avenge for the last four months of 2014 0.7476 2. Ventana Grans purchased additional equipment for 96,000 New Zealand dollars on July 1, 2014, by issuing a note for 78,000 New Zealand dollars and paying the balance in cash 3. Sales were made and purchases and other Expenses were incurred evenly throughout the year 4. Depreciation for the period in New Zealand dollars was computed as follows: Building 45,000 Equipment Purchased before 1/1/2014 85.400 Louipment --Purchased July 1, 2014 9,600 5. The inventory is valued on a firo basis. The beginning inventory was actured when the exchange rate was $0.7480. The ending stiventory was acquired during the last four months of 201 6. Dividends of 64,000 New Zealand dollars were paid on July 1 and December 31 (b) Prepare a schedule to verify the translation gain or loss determined in parta. Describe how the translation gain or loss would be reported in the financial statements (Round answers to decimal places, c. 5,125. Enter loss using either a negative siga preceding the number .. 2,945 or parentheses ed. (2,945).) Zealand