SECTION 4. FOREIGN INVESTMENT.

Ginvold Co. began operating a subsidiary in a foreign country on January 1, 2016 by acquiring all of the common stock for 50,000. This subsidiary immediately borrowed 120,000 on a five-year note with ten percent interest payable annually beginning on January 1, 2017. A building was then purchased for 170,000. This property had a ten-year anticipated life and no salvage value and was to be depreciated using the straight-line method. On January 1, 2016 the building was rented for three years to a group of local doctors for 6,000 per month. By year-end, payments totaling 60,000 had been made. On October 1, 5,000 were paid for a repair made to the building on that date. A cash dividend of 6,000 was paid to Ginvold on December 31, 2016. The functional currency for the subsidiary is the stickle. Currency exchange rates were as follows:

January 1, 2016	$2.40 = 1
October 1, 2016	$2.62 = 1
Average for 2016	$2.58 = 1
December 31, 2016	$2.36 = 1

Required: You must show all steps for full credit

a. Prepare an income statement for 2016 for this subsidiary in stickles and then translate these amounts into U.S. dollars.

b. Prepare a balance sheet at December 31, 2016 for this subsidiary in stickles and then translate these amounts into U.S. dollars.