Shames Company is located in London, England. The local currency is the British pound (). On January 1, 20X8, Pit Company purchased an 70 percent interest in Shames for $413,000, which resulted in an excess of cost-over-book value of $80,000 due solely to a trademark having a remaining life of 10 years. Pit uses the equity method to account for its investment. Shamess December 31, 20X8, trial balance has been translated into U.S. dollars, requiring a translation adjustment debit of $6,500. Shamess net income translated into U.S. dollars is $61,000. It declared and paid a 23,000 dividend on May 1, 20X8. Relevant exchange rates are as follows:

			$
January 1, 20X8	1	=	1.60
May 1, 20X8	1	=	1.64
December 31, 20X8	1	=	1.65
Average for 20X8	1	=	1.63

c. Show a calculation of the differential reported on the consolidated balance sheet of December 31, 20X8, and the translation adjustment from differential. (Amounts to be deducted should be entered with a minus sign. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

	British pounds	Exchange rate	U.S. Dollars
Income Statement:
Differential Jan. 1, 20X8		1.60
Amortization for 20X8		1.63
Remaining balance
Balance Sheet:
Remaining balance on Dec. 31 translated at year-end rate		1.65
Difference to translation adjustment