Problem 8-35 (LO 8-3, 8-4)

Sendelbach Corporation is a U.S.-based organization with operations throughout the world. One of its subsidiaries is headquartered in Toronto. Although this wholly owned company operates primarily in Canada, it engages in some transactions through a branch in Mexico. Therefore, the subsidiary maintains a ledger denominated in Mexican pesos (Ps) and a general ledger in Canadian dollars (C$). As of December 31, 2017, the subsidiary is preparing financial statements in anticipation of consolidation with the U.S. parent corporation. Both ledgers for the subsidiary are as follows:

Main OperationCanada
	Debit			Credit
Accounts payable				C$	23,770
Accumulated depreciation					34,000
Buildings and equipment	C$	174,000
Cash		33,000
Common stock					57,000
Cost of goods sold		210,000
Depreciation expense		7,600
Dividends, 4/1/17		26,000
Gain on sale of equipment, 6/1/17					5,700
Inventory		86,000
Notes payabledue in 2020					76,000
Receivables		75,000
Retained earnings, 1/1/17					142,590
Salary expense		30,000
Sales					319,000
Utility expense		9,700
Branch operation		6,760
Totals	C$	658,060		C$	658,060

Branch OperationMexico
	Debit			Credit
Accounts payable				Ps	53,200
Accumulated depreciation					22,700
Building and equipment	Ps	47,000
Cash		62,500
Depreciation expense		2,700
Inventory (beginningincome statement)		30,000
Inventory (endingincome statement)					31,500
Inventory (endingbalance sheet)		31,500
Purchases		64,000
Receivables		28,000
Salary expense		9,700
Sales					131,000
Main office					37,000
Totals	Ps	275,400		Ps	275,400

Additional Information

• The Canadian subsidiarys functional currency is the Canadian dollar, and Sendelbachs reporting currency is the U.S. dollar. The Canadian and Mexican operations are not viewed as separate accounting entities.

• The building and equipment used in the Mexican operation were acquired in 2007 when the currency exchange rate was C$0.18 = Ps 1.

• Purchases of inventory were made evenly throughout the fiscal year.

• Beginning inventory was acquired evenly throughout 2016; ending inventory was acquired evenly throughout 2017.

• The Main Office account on the Mexican records should be considered an equity account. This balance was remeasured into C$6,760 on December 31, 2017.

• Currency exchange rates for 1 Ps applicable to the Mexican operation follow:

Weighted average, 2016	C$	0.23
January 1, 2017		0.25
Weighted average rate for 2017		0.27
December 31, 2017		0.28

• The December 31, 2016, consolidated balance sheet reported a cumulative translation adjustment with a $43,950 credit (positive) balance.

• The subsidiarys common stock was issued in 2004 when the exchange rate was $0.52 = C$1.

• The subsidiarys December 31, 2016, retained earnings balance was C$142,590, an amount that has been translated into U.S.$66,123.

• The applicable currency exchange rates for 1 C$ for translation purposes are as follows:

January 1, 2017	US$	0.70
April 1, 2017		0.69
June 1, 2017		0.68
Weighted average rate for 2017		0.67
December 31, 2017		0.65

1. Remeasure the Mexican operations account balances into Canadian dollars. (Note: Back into the beginning net monetary asset or liability position.)

2. Prepare financial statements (income statement, statement of retained earnings, and balance sheet) for the Canadian subsidiary in its functional currency, Canadian dollars.

3. Translate the Canadian dollar functional currency financial statements into U.S. dollars so that Sendelbach can prepare consolidated financial statements.

Could you help me please?

Req A Req B and C Remeasure the Mexican operation's account balances into Canadian dollars. (Note: Back into the beginning net monetary asset or liability position.) (Input all amounts as positive values.) Canadian Dollars Debit Credit Accounts payable Accumulated depreciation Building and equipment Cash Depreciation expense Inventory (beginningincome statement) Inventory (endingincome statement) Inventory (ending-balance sheet) Purchases Receivables Salary expense Sales Main office Total b. Prepare financial statements (income statement, statement of retained earnings, and balance sheet) for the Canadian subsidiary in its functional currency, Canadian dollars. c. Translate the Canadian dollar functional currency financial statements into U.S. dollars so that Sendelbach can prepare consolidated financial statements. (Round U.S. Dollar values to 2 decimal places. Amounts to be deducted and losses should be indicated with a minus sign.) Show less ! SENDELBACH CORPORATION Financial Statements For the Year Ended December 31, 2017 Canadian U.S. Dollar Dollar Income Statement: c$ Statement of Retained Earnings: Retained earnings, 1/1/15 Retained earnings, 12/31/15 Statement of Retained Earnings: Retained earnings, 1/1/15 Retained earnings, 12/31/15 Balance Sheet: Assets: Total C$ Liabilities and Equities: Total b. Prepare financial statements (income statement, statement of retained earnings, and balance sheet) for the Canadian subsidiary in its functional currency, Canadian dollars. c. Translate the Canadian dollar functional currency financial statements into U.S. dollars so that Sendelbach can prepare consolidated financial statements. (Round U.S. Dollar values to 2 decimal places. Amounts to be deducted and losses should be indicated with a minus sign.) Show less ! SENDELBACH CORPORATION Financial Statements For the Year Ended December 31, 2017 Canadian U.S. Dollar Dollar Income Statement: c$ Statement of Retained Earnings: Retained earnings, 1/1/15 Retained earnings, 12/31/15 Statement of Retained Earnings: Retained earnings, 1/1/15 Retained earnings, 12/31/15 Balance Sheet: Assets: Total C$ Liabilities and Equities: Total