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Bogdan [553]
3 years ago
11

Parent Company's wholly-owned subsidiary, Son Corporation, maintains its accounting records in Danish krone. However, because al

l of Son's branch offices are in Sweden, its functional currency is the Swedish krona. Remeasurement of Son's 20X3 financial statements resulted in a $3,200 loss, and translation of its financial statement resulted in a $2,600 loss. What amount should Parent report as a loss in its income statement for the year ended December 31, 20X3?
Business
1 answer:
andreyandreev [35.5K]3 years ago
6 0

Answer:Nill

Explanation:

Foreign exchange transactions occur s between companies in different countries using different currency or a multinational company dealings with it's subsidiary.

However there is a difference between foreign exchange conversion and translation, conversion occurs as a result of selling or buying goods in foreign currency and the exchange rate has changed between the period of purchase and payment. In this situation the loss or gain are posted to the income statement.

Translation or remeasurement of financial position occurs at the year end especially to consolidate a subsidiary account by converting it's currency to the parent's company currency such difference are not posted to income statement but to the net assets.

You might be interested in
Why do we record Direct deposits into the CPJ
Oksi-84 [34.3K]

Explanation:

Because those payments are done for creditors, repayment of loans and other expenses

6 0
1 year ago
The following changes took place last year in Pavolik Company’s balance sheet accounts:
irinina [24]

Answer:

1. $260

2. $103

Explanation:

1. Calculation to determine the net cash provided by operating activities for the year

PAVOLIK COMPANY

STATEMENT OF CASH FLOWS PARTIAL (USING INDIRECT METHOD)

FOR THE YEAR ENDED

Particulars Amount

Cash flow from operating activities

Net Income $100

Adjustments to reconcile net income to net cash provided by operating activities

Adjustment for non cash effects

Depreciation $82

Loss on sale of land $21

Gain on sale of investments -$25

Change in operating assets & liabilities

Increase in accounts receivable -$24

Decrease in inventory $58

Increase in prepaid expenses -$19

Increase in accounts payable $62

Decrease in accrued liabilities -$24

Increase in income taxes payable $29

Net cash flow from operating activities (a) $260

Therefore Using the indirect method the net cash provided by operating activities for the year is $260

2. Preparation of a statement of cash flows for the year

PAVOLIK COMPANY

STATEMENT OF CASH FLOWS (USING INDIRECT METHOD)

FOR THE YEAR ENDED

Particulars Amount

$

Cash flow from operating activities (a) $260

Cash Flow from Investing activities

Property,plant and equipment purchased -$395

Long term investment sold $46

Land sold $24

Net cash Flow from Investing activities (b) -$325

(-$395+$46+$24)

Cash Flow from Financing activities

Cash dividends paid -$18

Common stock purchased -$96

Bonds issued $204

Net cash Flow from Financing activities (c) $90

(+$204-$18-$96)

Net Change in cash c=a+b+c -$25

Beginning cash balance $128

Closing cash balance $103

($128-$25)

Therefore the statement of cash flows for the year is $103

4 0
2 years ago
The state of Indiana charges a 6% sales tax on most consumer goods. Grant purchased a generator for $400 and paid an additional
faltersainse [42]

Answer:

the correct answer is

The $400 retail price of the generator.

good luck

8 0
3 years ago
You are considering buying common stock in Grow On, Inc. The firm yesterday paid a dividend of $7.80. You have projected that di
Lina20 [59]

Answer:

The answer is $56.68

Explanation:

Solution

We recall that:

The firm paid a dividend of =$7.80

The projected growth of dividends is at a rate = 9.0%

The annual return = 24.0%

Now,

V = ($7.80 * (1.09)/(.24 - 0.9)

= (8.502)/(.24-0.9)

= (8.502) * (-0.66)

= $56.68

Therefore, this would be the most we would pay for the stock. If we paid less than that, our return would be above the 24%.

3 0
2 years ago
On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances:
ivolga24 [154]

Answer:

TNT Fireworks

1. Adjusting Entries on January 31:

Accounts                              Debit         Credit

a. Depreciation Expense     $375

Accumulated Depreciation                $375

b. Uncollectible Expense   $5,620

Allowance for Uncollectible Accounts $5,620

c. Accrued interest revenue $120

Interest Revenue                                 $120

d. Salaries Expense           $34,000

Salaries payable                                 $34,000

e. Income Tax Expense     $10,400

Income tax payable                            $10,400

2. Adjusted Trial Balance as of January 31, 2021:

Accounts                              Debit         Credit

Cash                                   $ 2,600

Accounts Receivable       238,400

Allowance for Uncollectible Accounts $9,220

Inventory                            12,600

Notes Receivable

(5%, due in 2 years)        28,800

Land                                169,000

Equipment                       20,900

Accumulated Depreciation                      375

Depreciation Expense         375

Salaries Expense           65,200

Utilities Expense             17,900

Income Tax Expense     10,400

Uncollectible Expense   5,620

Accounts Payable                             102,200

Salaries Payable                                34,000

Income Taxes Payable                      10,400

Common Stock                              234,000

Retained Earnings                           69,600

Sales Revenue                              234,000

Interest Revenue                                  120

Accrued Interest

Receivable                      120

Cost of Goods Sold 122,000

Total                      $693,925  $693,915

3. Multi-step Income Statement for the period ended January 31, 2021:

Sales Revenue                              234,000

Cost of goods sold                        122,000

Gross profit                                  $112,000

Interest Revenue                                 120

Total revenue                              $112,120

Depreciation Expense         375

Salaries Expense           65,200

Utilities Expense             17,900

Uncollectible Expense   5,620  $89,095

Income before tax                      $23,025

Income Tax Expense                    10,400

Net Income                                 $12,625

Retained Earnings, January 1     69,600

Retained Earnings, January 31 $82,225

4. Classified Balance Sheet as of January 31, 2021:

Assets:

Cash                                                   $ 2,600

Accounts Receivable       238,400

Uncollectible Accounts       9,220   229,180

Accrued Interest Receivable                   120

Inventory                                             12,600

Current assets                              $244,500

Notes Receivable

(5%, due in 2 years)         28,800

Land                                  169,000

Equipment            20,900

Accumulated Dep.     375 20,525  218,325

Total assets                                  $462,825

Liabilities:

Accounts Payable           102,200

Salaries Payable               34,000

Income Taxes Payable     10,400 $146,600

Equity:

Common Stock             234,000

Retained Earnings          82,225  $316,225

Total liabilities and Equity           $462,825

5. Closing Journal Entries:

Accounts                              Debit         Credit

Income Summary             $221,495

Depreciation Expense                                  375

Salaries Expense                                    65,200

Utilities Expense                                      17,900

Income Tax Expense                              10,400

Uncollectible Expense                             5,620

Cost of Goods Sold                             122,000

To close temporary accounts to the income summary.

Sales Revenue                 234,000

Interest Revenue                     120

Income Summary                              $234,120

To close temporary accounts to the income summary.

Cash                                   $ 2,600

Accounts Receivable       238,400

Inventory                             12,600

Notes Receivable

(5%, due in 2 years)         28,800

Accrued Interest

Receivable                             120

Land                                169,000

Equipment                       20,900

Allowance for Uncollectible Accounts $9,220

Accumulated Depreciation                        375

Accounts Payable                               102,200

Salaries Payable                                   34,000

Income Taxes Payable                         10,400

Common Stock                                 234,000

Retained Earnings                              82,225

To close permanent accounts to the balance sheet.

Explanation:

a) Data and Calculations:

Accounts                              Debit         Credit

Cash                                 $ 60,100

Accounts Receivable         27,800

Allowance for

 Uncollectible Accounts                       $ 3,600

Inventory                            37,700

Notes Receivable

 (5%, due in 2 years)        28,800

Land                                 169,000

Accounts Payable                                  16,200

Common Stock                                   234,000

Retained Earnings                                69,600

Totals                          $ 323,400   $ 323,400

See workings attached.

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8 0
3 years ago
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