Sullivan's Island Company began operating a subsidiary in a foreign country on January 1, 2024, by investing capital in the amount of 102,000 pounds. The subsidiary immediately borrowed 245,000 pounds on a five-year note with 7 percent interest payable annually beginning on January 1, 2025. The subsidiary then purchased for 347,000 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, 2024, the subsidiary rented the building for three years to a group of local attorneys for 9,050 pounds per month. By year-end, rent payments totaling 90,500 pounds had been received, and 18,100 pounds was in accounts receivable. On October 1, 2024, 4,500 pounds was paid for a repair made to the building. The subsidiary transferred a cash dividend of 11,475 pounds back to Sullivan's Island Company on December 31, 2024. The functional currency for the subsidiary is the pound. Currency exchange rates for 1 pound follow:

January 1, 2024$ 2.00 = 1 PoundOctober 1, 20242.05 = 1 PoundDecember 31, 20242.08 = 1 PoundAverage for 20242.04 = 1 Pound

Required:

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. Prepare a Statement of Retained earnings. Note: Amounts to be deducted should be indicated by a minus sign. Prepare a Balance Sheet. Note: Amounts to be deducted should be indicated by a minus sign. Prepare an Income Statement. Note: Amounts to be deducted should be indicated by a minus sign