step and solution

Sullivan's Island Company began operating a subsidiary in a foreign country on January 1, 2020, by investing capital in the amount of 74,000 pounds. The subsidiary immediately borrowed 175,000 pounds on a five-year note with 5 percent interest payable annually beginning on January 1, 2021. The subsidiary then purchased for 249,000 pounds a building that had a 10-year expected life and no salvage value and is to be depreciated using the straight-line method. Also on January 1, 2020, the subsidiary rented the building for three years to a group of local attorneys for 8,350 pounds per month. By year-end, rent payments totaling 83,500 pounds had been received, and 16,700 pounds was in accounts receivable. On October 1, 2020, 3,100 pounds was paid for a repair made to the building. The subsidiary transferred a cash dividend of 11,825 pounds back to Sullivan's Island Company on December 31, 2020. The functional currency for the subsidiary is the pound. Currency exchange rates for 1 pound follow: January 1, 2020 $ 2. 70 = 1 Pound October 1, 2020 2. 75 December 31, 2020 2 . 88 = Average for 2020 2 . 78 = H HH Prepare an income statement, statement of retained earnings, and balance sheet for this subsidiary in pounds and then translate these amounts into U.S. dollars. Complete this question by entering your answers in the tabs below. Income Retained Statement Earnings Balance SheetPrepare a Balance Sheet. (Amounts to be deducted should be indicated by a minus sign.) SULLIVAN'S ISLAND COMPANY Balance Sheet December 31, 2020 Pounds U.S. Dollars Assets: Cash Accounts receivable Building Accumulated depreciation Total assets 0 Liabilities and Equities: Interest payable Note payable Contributed capital Retained earnings Translation adjustment Total liabilities and equities 0 $ 0