Question

Refer to the information in Problem P12-21. Assume that the dollar is the functional currency.
In P12-21
Additional Information
1. DaSilva uses FIFO inventory valuation. Purchases were made uniformly during 20X4.
Ending inventory for 20X4 is composed of units purchased when the exchange rate was $0.25.
2. The insurance premium for a two-year policy was paid on October 1, 20X3.
3. Plant and equipment were acquired as follows:

Date Cost
January 1, 20X1 ... BRL200,000
July 10, 20X2 .... 50,000
April 7, 20X4 .... 100,000

4. Plant and equipment are depreciated using the straight-line method and a 10-year life, with no residual value. A full month’s depreciation is taken in the month of acquisition.
5. The intangible assets are patents acquired on July 10, 20X2, at a cost of BRL60,000. The estimated life is five years.
6. The common stock was issued on January 1, 20X1.
7. Dividends of BRL10,000 were declared and paid on April 7. On October 9, BRL15,000 of dividends were declared and paid.
8. Exchange rates were as follows:
BRL $
January 1, 20X1 ..... 1 = 0.45
July 10, 20X2 ...... 1 = 0.40
October 1, 20X3 ..... 1 = 0.34
January 1, 20X4 ..... 1 = 0.30
April 7, 20X4 ...... 1 = 0.28
October 9, 20X4 ..... 1 = 0.23
December 31, 20X4 ....1 = 0.20
20X4 average ...... 1 = 0.25
Required
a. Prepare a schedule remeasuring DaSilva Company’s December 31, 20X4, trial balance from reals to dollars.
b. Prepare a schedule providing a proof of the remeasurement gain or loss.



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  • CreatedMay 23, 2014
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