Big acquired 100% of Little on 1/1/19 for 100,000 Euros, which at that time was $110,000 ($1.10 per Euro).  

Little has the above end-of-year trial balance, denominated in Euros. At the end of the year, the exchange rate was $1.25/Euro The average exchange rate over the course of the year was $1.20. 

How much of a translation gain or loss will there be in 2019?

  

Transcribed Image Text:

Euro Assets 200,000 Liabilities 80,000 Common Stock Retained earnings Sales 50,000 50,000 100,000 Expenses 80,000 OCI - translation gain/loss Exchange rate Euro Assets 200,000 Liabilities 80,000 Common Stock Retained earnings Sales 50,000 50,000 100,000 Expenses 80,000 OCI - translation gain/loss Exchange rate

Answer rating: 100% (QA)

To determine the translation gain or loss we need to restate the trial balance of Little from Euros ... View the full answer