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$		29,105
Accumulated depreciation												37,000
Buildings and equipment						C$		177,000
Cash								36,000
Common stock												60,000
Cost of goods sold								213,000
Depreciation expense								7,900
Dividends, 4/1/17								29,000
Gain on sale of equipment, 6/1/17												6,000
Inventory								89,000
Notes payabledue in 2020												79,000
Receivables								78,000
Retained earnings, 1/1/17												145,590
Salary expense								33,000
Sales												322,000
Utility expense								10,000
Branch operation								5,795
Totals						C$		678,695		C$		678,695

Branch OperationMexico
						Debit				Credit
Accounts payable										Ps		47,500
Accumulated depreciation												19,500
Building and equipment						Ps		50,000
Cash								64,000
Depreciation expense								3,000
Inventory (beginningincome statement)								33,000
Inventory (endingincome statement)												33,000
Inventory (endingbalance sheet)								33,000
Purchases								50,000
Receivables								31,000
Salary expense								10,000
Sales												134,000
Main office												40,000
Totals						Ps		274,000		Ps		274,000

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$0.15 = 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$5,795 on December 31, 2017.

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

Weighted average, 2016			C$	0.20
January 1, 2017				0.22
Weighted average rate for 2017				0.24
December 31, 2017				0.25

The December 31, 2016, consolidated balance sheet reported a cumulative translation adjustment with a $46,950 credit (positive) balance.

The subsidiarys common stock was issued in 2004 when the exchange rate was $0.55 = C$1.

The subsidiarys December 31, 2016, retained earnings balance was C$145,590, an amount that has been translated into U.S.$63,963.

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

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

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

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