Translation and Remeasurement of Account Balances

U.S. Industries has a subsidiary in Switzerland. The subsidiary's financial statements are maintained in Swiss francs (CHF). Exchange rates ($/CHF) for selected dates are as follows:

January 1, 2018$1.02November 30, 2020$1.08January 1, 20191.04December 31, 20201.09Average for 20201.06

The following items appear in the subsidiary's trial balance at December 31, 2020:

1. Cash in bank, CHF4,000,000.

2. Inventory, CHF3,000,000. The inventory was acquired on November 30, 2020.

3. Machinery and equipment, CHF11,000,000. A review of the records indicates that the company bought equipment costing CHF5,000,000 in January 2018 (20 percent of this was sold in January 2020) and additional equipment costing CHF7,000,000 in January 2019. Ignore accumulated depreciation.

4. Depreciation expense on machinery and equipment, CHF1,100,000 (depreciated over ten years, straight-line basis).

Required

Calculate the dollar amount for each of the above items, assuming the functional currency of the Swiss subsidiary is

(a) the U.S. dollar and

(b) the Swiss franc.

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

(a)(b)Cash$Answer

$Answer

Inventory$Answer

$Answer

Machinery and equipment$Answer

$Answer

Depreciation expense$Answer

$Answer