Dakota, Inc. , a U. S. based company, owns a company that operates in France. Account balances in francs for the subsidiary are shown below: 2017 January 1 December 31Cash and Receivables 24,000 26,000Supplies 1,000 500Property, Plant, and Equipment 52,500 49,000Accounts Payable (11,500) (5,500)Long-term Notes Payable (19,000) (11,000)Common Stock (30,000) (30,000)Retained Earnings (17,000) (17,000)Dividends-Declared & Paid on Dec 31 —- 3,000Revenues —- (30,000)Operating Expenses —- 15,000 Totals -0- -0-Exchange rates for 2017 were as follows: January 1 $0. 22Average for the year 0. 19December 31 0. 18Revenues were earned and operating expenses, except for depreciation and supplies used, were incurred evenly throughout the year. No purchases of supplies or plant assets were made during the year. Note: supplies are a non-monetary asset and should be treated like PPE. Required: A. Prepare the financial statements for the year, assuming the subsidiary’s functional currency is the franc. B. Prepare the financial statements for the year, assuming the subsidiary’s functional currency is the U. S. dollar.
Originally posted 2018-07-09 20:53:17. Republished by Blog Post Promoter