Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Translation and Remeasurement of Inventory and Cost of Sales Shopwell is a U.K. grocery chain that is a subsidiary of Premium Products, a U.S. company.

Translation and Remeasurement of Inventory and Cost of Sales

Shopwell is a U.K. grocery chain that is a subsidiary of Premium Products, a U.S. company. Premiums fiscal year ends January 31. On February 1, 2018, Shopwells inventory balance consisted of 100,000 purchased when the exchange rate was $1.20/, and 300,000 purchased when the exchange rate was $1.23/. Shopwell made purchases of 5,000,000 evenly throughout fiscal 2019, and its inventory on January 31, 2019, consisted of 350,000 purchased when the exchange rate was $1.29/. Shopwells sales of inventory occurred relatively evenly throughout fiscal 2019. The average exchange rate for fiscal 2019 was $1.26/, and the January 31, 2019, exchange rate was $1.30/.

Required

a. Assume that Shopwells functional currency is the pound. Calculate Shopwells translated ending inventory at January 31, 2019, and its translated cost of sales for fiscal 2019.

b. Now assume that Shopwells functional currency is the U.S. dollar. Calculate Shopwells remeasured ending inventory at January 31, 2019, and its remeasured cost of sales for fiscal 2019.

a. Translated b. Remeasured
Ending inventory Answer

Answer

Cost of sales Answer

Answer

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Pioneers Of A Profession Chartered Accountants To 1879

Authors: Jas. C. Stewart

1st Edition

0367532557, 9780367532550

More Books

Students also viewed these Accounting questions