PROBLEM 5 Translated/Remeasured Trial Balances On January 1, 2019, the U.K. subsidiary of U.S. Inter national Corporation had the following condensed balance sheet, in pounds sterling (in millions): Assets Cash and receivables.. Inventory (FIFO).... Plant assets .......... Accumulated depreciation.. Total assets ............ Liabilities and equity Accounts payable.. Long-term debt Equity... $2,000 2,200 1,600 (400) 5,400 2,100 1,200 2,100 5.400 Total llabilities and equity......... The exchange rate on January 1, 2019 was $1.20/. Inventory at January 1 was purchased when the ex change rate was $1.18/. Plant assets at January 1 were acquired when the exchange rate was 51.80/. Plant assets costing 200 million were purchased when the exchange rate was $1 22J. Depreciation of 50 was taken on these plant assets in 2019. At the end of 2019, the subsidiary reported the following trial balance: (in millions) Cash and receivables... Inventory (FIFO) Plant assets ..... Accumulated depreciation Accounts payable Long-term debt .. Equity, January 1.. Sales.......... Cost of goods sold..... Depreciation expense.. Other operating expenses. Total Dr (CT) 2,660 2.500 1,800 (560) (2,200) (1.100) (2.100) (4,000) 2,000 160 840 The ending inventory was purchased when the exchange rate was $1.28/. Sales and other operating expenses occurred evenly over the year. At year-end, the exchange rate was $1.30/E; the average for the year was $1.25/. Required Prepare the remeasured December 31, 2019 trial balance of the U.K. subsidiary, assuming the US dollar is the functional currency of the subsidiary. Assume the remeasured balance of equity on Janu- ary 1, 2019 was $3.396 million. Prepare a schedule to calculate the remeasurement sain or loss for 2019. b. Repeat parta, assuming the pound is the functional currency of the subsidiary. Assume the translated balance of equity on January 1, 2019, is $2,520 million. Prepare a schedule to calculate the transla- tion gain or loss for 2019