The Thode Company established a wholly$-$owned subsidiary in Saudi Arabia on January $1,2016,$ when the exchange rate was $$0\mathrm{.}30/$riyal $($SAR$).$ Of Thode$$s initial SAR$160,000,000$ investment, SAR$80,000,000$ was used to acquire plant assets $($ten$-$year life$)$ and SAR$40,000,000$ was used to acquire inventory. The remaining amount was initially held as cash by the subsidiary.

During $2016,$ the subsidiary reported net income of SAR$16,000,000.$ Inventory purchases of SAR$12,000,000$ were made evenly during the year. It paid dividends of SAR$8,000,000$ on September $30,$ when the exchange rate was $$0\mathrm{.}255/$SAR$.$ No other transactions occurred between the subsidiary and the parent. The subsidiary's condensed income statement appears below:

Sales SAR$68,000,000$

Cost of goods sold $(32,000,000)*$

Depreciation expense $(8,000,000)**$

Other cash expenses $(12,000,000)$

Net income SAR$16,000,000$

$*$Assume a FIFO inventory flow assumption.

$**$Relates solely to plant assets acquired on January $1,2016.$

The average rate during the year was $$0\mathrm{.}265/$SAR$.$ On the balance sheet date, it was $$0\mathrm{.}25/$SAR$.$

$($a$)$ Assuming the functional currency is the riyal, translate the subsidiary's preclosing trial balance at December $31,2016,$ and prepare a schedule calculating the subsidiary's translation gain or loss for $2016.$

Use negative signs with your $Cr($credit balance$)$ answers, in the $PDr(Cr)$ and $$Dr(Cr)$ columns only.

Enter answers using all zeros $($do not abbreviate answers to millions or thousands$).$

$($a$)$ Assuming the functional currency is the riyal, translate the subsidiary's preclosing trial balance at December $31,2016,$ and prepare a schedule calculating the subsidiary's translation gain or loss for $2016.$

Use negative signs with your $Cr($credit balance$)$ answers, in the $PDr(Cr)$ and $$Dr(Cr)$ columns only.

Enter answers using all zeros $($do not abbreviate answers to millions or thousands$).$

Assuming the functional currency is the riyal, translate the subsidiary$$s preclosing trial balance at December $31,2016,$ and prepare a schedule calculating the subsidiary$$s translation gain or loss for $2016.$

Use negative signs with your Cr $($credit balance$)$ answers, in the P Dr$($Cr$)$ and $ Dr$($Cr$)$ columns only.

Enter answers using all zeros $($do not abbreviate answers to millions or thousands$).$

December $31,2016$

Translated Trial Balance

SAR

Dr $($Cr$)$ $$/$SAR $

Dr $($Cr$)$

Cash Answer

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Inventory Answer

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Plant assets Answer

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Capital Answer

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Dividends Answer

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Sales Answer

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Cost of goods sold Answer

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Depreciation expense Answer

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Other expenses Answer

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Other comprehensive loss $($translation gain or loss$)$ below Answer

Net income Answer

Answer

Instructions for Translation Gain$/$Loss Schedule:

Use negative signs with answers to indicate a negative exposed position balance.

Use negative signs with answers to indicate an amount that reduces the exposed position balance.

Using the drop$-$down menu, select the appropriate answer to indicate a translation gain or translation loss.

Do not use a negative sign with your translation gain or translation loss answer.

Enter answers using all zeros $($do not abbreviate to millions or thousands$).$

Translation Gain$/$Loss Schedule

SAR $$/$SAR $

Exposed position, beginning Answer

Answer

Answer

Net Income Answer

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Dividends Answer

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Answer

Exposed position, ending Answer

Answer

Answer

Answer

Answer

$($b$)$ Assuming the functional currency is the U$.$S$.$ dollar, remeasure the subsidiary$$s preclosing trial balance at December $31,2016,$ and prepare a schedule calculating the subsidiary$$s remeasurement gain or loss for $2016.$

Use negative signs with your Cr $($credit balance$)$ answers, in the P Dr$($Cr$)$ and $ Dr$($Cr$)$ columns only.

Enter answers using all zeros $($do not abbreviate answers to millions or thousands$).$

December $31,2016$

Remeasured Trial Balance

SAR

Dr $($Cr$)$ $$/$SAR $

Dr $($Cr$)$

Cash Answer

Answer

Answer

Inventory Answer

Answer

Plant assets Answer

Answer

Answer

Capital Answer

Answer

Answer

Dividends Answer

Answer

Answer

Sales Answer

Answer

Answer

Cost of goods sold Answer

Answer

Answer

Depreciation expense Answer

Answer

Answer

Other expenses Answer

Answer

Answer

Remeasurement gain or loss below Answer

Answer

Answer

Instructions for Remeasurement Gain$/$Loss Schedule:

Use negative signs with answers to indicate a negative exposed position balance.

Use negative signs with answers to indicate an amount that reduces the exposed position balance.

Using the drop$-$down menu, select the appropriate answer to indicate a remeasurement gain or remeasurement loss.

Do not use a negative sign with your remeasurement gain or remeasurement loss answer.

Enter answers using all zeros $($do not abbreviate to millions or thousands$).$

Remeasurement Gain$/$Loss Schedule

SAR $$/$SAR $

Ex