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$). As of December 31, 2017, the subsidiary is preparing financial statements in anticipation of consolidation with the U.S. parent corporation. Both ledgers for the subsidiary are as follows: Credit c$ 35, 470 39,000 62,000 Main Operation-Canada Debit Accounts payable Accumulated depreciation Buildings and equipment c$ 179,000 Cash 38,000 Common stock Cost of goods sold 215,000 Depreciation expense 8,100 Dividends, 4/1/17 31,000 Gain on sale of equipment, 6/1/17 Inventory 91,000 Notes payable-due in 2020 Receivables 80,000 Retained earnings, 1/1/17 Salary expense 35,000 Sales Utility expense 10,200 Branch operation 7,960 Totals C$ 695,260 6,200 81,000 147,590 324,000 C$ 695,260 Credit Ps 62,200 37,200 Branch OperationMexico Debit Accounts payable Accumulated depreciation Building and equipment Ps 52,000 Cash 65,000 Depreciation expense 3,200 Inventory (beginning-income statement) 35,000 Inventory (ending-income statement) Inventory (ending-balance sheet) 34,000 Purchases 69,000 34,000 33,000 10,200 Receivables Salary expense Sales Main office Totals 136,000 32,000 Ps 301,400 Ps 301,400 Additional Information The Canadian subsidiary's functional currency is the Canadian dollar, and Sendelbach's 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$0.24 = 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$7,960 on December 31, 2017 . Currency exchange rates for 1 Ps applicable to the Mexican operation follow: Weighted average, 2016 January 1, 2017 Weighted average rate for 2017 December 31, 2017 C$ 0.29 0.31 0.33 0.34 The December 31, 2016, consolidated balance sheet reported a cumulative translation adjustment with a $48,950 credit (positive) balance. The subsidiary's common stock was issued in 2004 when the exchange rate was $0.41 = C$1. The subsidiary's December 31, 2016, retained earnings balance was C$147,590, an amount that has been translated into U.S.$72,343. The applicable currency exchange rates for 1 C$ for translation purposes are as follows: January 1, 2017 April 1, 2017 June 1, 2017 Weighted average rate for 2017 December 31, 2017 US$ 0.70 0.69 0.68 0.67 0.65 a. Remeasure the Mexican operation's account balances into Canadian dollars. (Note: Back into the beginning net monetary asset or liability position.) 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. Complete this question by entering your answers in the tabs below. Show less A Req A Reg B and C 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 Dollar U.S. Dollar Income Statement: C$ C$ 0 $ 0.00 C$ 0 $ 0.00 Statement of Retained Earnings: Retained earnings, 1/1/15 C$ c$ Retained earnings, 12/31/15 C 0 $ 0.00 Balance Sheet: Assets: C$ Total C$ 0 $ 0.00 Liabilities and Equities: C$ Total C$ O $ 0.00