Complete the following worksheet, assuming that on January 1, 20X1, Weiss Corporation purchased Rock Corporation. Rock’s functional currency is the FC. Date Relevant Exchange Rates

Complete the following worksheet, assuming that on January 1, 20X1, Weiss Corporation

purchased Rock Corporation. Rock’s functional currency is the FC.

Date Relevant Exchange Rates

January 1, 20X1 1 FC = $0.25

January 1, 20X4 1 FC = $0.30

March 31, 20X4 1 FC = $0.40

December 31, 20X4 1 FC = $0.50

Weighted average 20X4 1 FC = $0.37

Rock Corporation

For the Year Ended December 31, 20X4

FC Rate Dollars

Income Statement

Net sales FC 2,000,000 $

Costs and expenses 800,000

Net income FC 1,200,000 $

Statement of Retained Earnings

Retained earnings, beginning of year FC 6,500,000 $1,300,000

Net income 1,200,000

Subtotal FC 7,700,000 $

Dividends (declared on March 31) 1,000,000

Retained earnings, end of year FC 6,700,000 $

Balance Sheet

Assets:

Current assets FC 3,000,000 $

Plant assets (net)

(purchased January 1, 20X1) 55,000,000

Total assets FC 58,000,000 $

Liabilities and Stockholders’ Equity:

Current liabilities FC 4,000,000 $

Long-term debt 25,000,000

Common stock (issued January 1, 20X1) 5,000,000

Paid-in capital in excess of par 17,300,000

Retained earnings 6,700,000

Cumulative translation adjustments

Total liabilities and stockholders’ equity FC 58,000,000 $

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