Translation of financial statements and consolidation of a foreign subsidiary (no amortization of AAP) Assume that your company owns a subsidiary operating in Great Britain. The subsidiary maintains its books in the British pound (GBP) as its functional currency. The relevant exchange rates for the sUs value of the British pound (GBP) are as follows: HINT: For all parts of this problem, yse a negative sign with your answers to indicate a reduction. a. Translate the subsidiary's income statement, statement of retained earnings, balance sheet, and statement of cash flows from British pounds (GBP) into \$US (assume that the BOY Retained Earnings for the subsidiary is $3,901,380 ). Round answers in the "In US Dollars" column to the nearest whole number. b. Compute the ending Cumulative Translation Adjustment directly, assuming a BOY balance of $(185,980). What journal entry did the parent company make as a result of this computation? Round all answers to the nearest whole number. EOY cumulative translation adjustment c. Following are selected financial statement accounts for the parent: subsidiary's balance sheet. Confirm the balance of the Equity Investment account of $5,608,658 on the parent's balance sheet. d. Using your translated subsidiary financial statements from Part a and the parent's financial data provided in Part c, prepare the consolidation spreadsheet for the year. Property, plant and equipment (PPE), net Translation of financial statements and consolidation of a foreign subsidiary (no amortization of AAP) Assume that your company owns a subsidiary operating in Great Britain. The subsidiary maintains its books in the British pound (GBP) as its functional currency. The relevant exchange rates for the sUs value of the British pound (GBP) are as follows: HINT: For all parts of this problem, yse a negative sign with your answers to indicate a reduction. a. Translate the subsidiary's income statement, statement of retained earnings, balance sheet, and statement of cash flows from British pounds (GBP) into \$US (assume that the BOY Retained Earnings for the subsidiary is $3,901,380 ). Round answers in the "In US Dollars" column to the nearest whole number. b. Compute the ending Cumulative Translation Adjustment directly, assuming a BOY balance of $(185,980). What journal entry did the parent company make as a result of this computation? Round all answers to the nearest whole number. EOY cumulative translation adjustment c. Following are selected financial statement accounts for the parent: subsidiary's balance sheet. Confirm the balance of the Equity Investment account of $5,608,658 on the parent's balance sheet. d. Using your translated subsidiary financial statements from Part a and the parent's financial data provided in Part c, prepare the consolidation spreadsheet for the year. Property, plant and equipment (PPE), net
