Problem
A U.S. company owns an 30% interest in a company located on Mars. Martian currency is called the Martian Credit. During the year the parent company sold inventory that had cost $23,700 to the subsidiary on account for $29,500 when the exchange rate was $05192. The subsidiary still held one-half of the inventories and had not paid the parent company for the purchase at the end of the fiscal period. The unsettled account is denominated in dollars. The exchange rate at the fiscal year-end was $04994.
Assuming that the transaction had been denominated in 49,517 Martian Credits rather than dollars, compute the transaction gain or loss that would be reported by the parent company.