Problem - On January 1, 2013 Cleanup Corporation created Junkyard Corporation as a 100% owned Subsidiary in Switzerland with an initial investment of Swiss Francs (SFR) 140,000. Junkyards trail balance at 12/31/2013 is below.
Additional Facts:
1- Dividends were declared and paid on November 1st 2013
2- Purchases of inventory were made evenly during the year. The last inventory purchase was on November 1st 2013
3- Equipment was purchased on March 1st 2013
4- Exchange Rate for the year is as follows:
|
Exchange Rate
|
SFr
|
$
|
|
January 1st 2013
|
1
|
0.80
|
|
March 1st 2013
|
1
|
0.82
|
|
November 1st 2013
|
1
|
0.85
|
|
December 31st 2013
|
1
|
0.88
|
|
Average for the Year
|
1
|
0.84
|
Requirement:
1- Prepare a schedule translating the December 31, 2013 trail balance from Swiss Francs to US dollars and determine the exchange gain or loss.
2- Prepare Proof the translation gain and loss is correct for #1 above.
3- Prepare a schedule re-measuring the December 31, 2013 trail balance from Swiss Francs to US dollars and determine the exchange gain or loss.
Attachment:- Assignment.rar