Question 4 Sundance Sporting Goods, Inc., is a U.S. manufacturer of high-quality sporting goodsprincipally golf, tennis and other racquet equipment, and also lawn sports, such as croquet and badminton with administrative offices and manufacturing facilities in Chicago, Illinois. Sundance has two wholly owned manufacturing affiliates, one in Mexico and the other in Canada. The Mexican affiliate is located in Mexico City and services all of Latin America. The Canadian affiliate is in Toronto and serves only Canada. Each affiliate keeps its books in its local currency, which is also the functional currency for the affiliate. The current exchange rates are: $1.00 = CD1.25 = Ps3.30 = A1.00 = 105 = W800. The non-consolidated balance sheets for Sundance and its two affiliates appear in the accompanying table.

(a.) Using the current exchange rates and the non-consolidated balance sheets for Sundance and its affiliates, prepare a consolidated balance sheet for the MNC according to: (1.) the current/non-current method

(2.) the monetary/non-monetary method

(3.) the temporal method

(4.) the current rate method. Table

1: Non-consolidated Balance Sheet for Sundance Sporting Goods, Inc. and Its Mexican and Canadian Sundance, Inc. (Parent) Mexican Affiliate Canadian Affiliate Assets Cash $ 1,500 P s 1,420 CD 1,200 Accounts Receivable 2,500a 2,800e 1,500f Inventory 5,000 6,200 2,500 Investment in Mexican Affiliate 2,400bInvestment in Canadian Affiliate 3,600c Net Fixed Assets 12,000 11,200 5,600Total Assets $ 27,000 P s 21,620 CD 10,800 Liabilities and Net Worth Accounts Payable $ 3,000 P s 2,500a CD 1,700 Notes Payable 4,000d 4,200 2,300 Long-Term Debt 9,000 7,000 2,300 Common Stock 5,000 4,500b 2,900c Retained Earnings 6,000 3,420b 1,600c Total Liabilities and Net Worth $ 27,000 P s 21,620 CD 10,800 a The parent firm is owed Ps1,320,000 by the Mexican affiliate. This sum is included in the parents accounts receivable as $400,000, translated at Ps3.30/$1.00. The remainder of the parents (Mexican affiliates) accounts receivable (payable) is denominated in dollars (pesos). b The Mexican affiliate is wholly owned by the parent firm. It is carried on the parent firms books at $2,400,000. This represents the sum of the common stock (Ps 4,500,000) and retained earnings (Ps3,420,000) on the Mexican affiliates books, translated at Ps3.30/$1.00. c The Canadian affiliate is wholly owned by the parent firm. It is carried on the parent firms books at $3,600,000. This represents the sum of the common stock (CD2,900,000) and the retained earnings (CD1,600,000) on the Canadian affiliates books, translated at CD1.25/$1.00. d The parent firm has outstanding notes payable of 126,000,000 due a Japanese bank. This sum is carried on the parent firms books as $1,200,000, translated at 105/$1.00. Other notes payable are denominated in U.S. dollars. e The Mexican affiliate has sold on account A120,000 of merchandise to an Argentine import house. This sum is carried on the Mexican affiliates books as Ps396,000, translated at A1.00/Ps3.30. Other accounts receivable are denominated in Mexican pesos. f The Canadian affiliate has sold on account W192,000,000 of merchandise to a Korean importer. This sum is carried on the Canadian affiliates books as CD300,000, translated at W800/CD1.25. Other accounts receivable are denominated in Canadian dollars.