On January 1, Dandu Corporation started a subsidiary in a foreign country. On April 1, the subsidiary

Question:

On January 1, Dandu started a subsidiary in a foreign country. On April 1, the subsidiary purchased inventory at a cost of 120,000 local currency units (LCU). One-fourth of this inventory remained unsold at the end of the year while 40 percent of the liability from the purchase had not yet been paid. The exchange rates for $1 were as follows:
January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . $1 = LCU 2.5
April 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 = 2.8
Average for the current year . . . . . . . . . . . . . 1 = 2.7
December 31 . . . . . . . . . . . . . . . . . . . . . . . . . 1 _ 3.0
What should be the December 31 Inventory and balances for this foreign subsidiary as translated into U.S. dollars using the current rate method?

Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...