Comparative balance sheets and the intervening statement of income and retained earnings for Sears Canada Inc. appear below. Sears Canada is a subsidiary of Sears Holdings Corporation, a U.S. corporation. All amounts are in Canadian dollars

Exchange rates (U.S.$/C$) are as follows:
January 30, 2010 $0.94
Average, January 30, 2010 to January 29, 2011 $0.97
January 29, 2011 $1.02
Required
a. Prepare a statement of cash Hows (indirect format) in Canadian dollars and U.S. dollars for the year ended January 29, 2011, and a computation of the effect of exchange rate changes on cash. Assume all investing and financing activities took place evenly throughout the year and that Sears Canada's functional currency is the Canadian dollar.
b. Prepare a schedule computing the January 29, 2011, cumulative translation adjustment balance (the only component of AOCI), including computation of the translation adjustment for the year ended January 29,2011. Assume that the beginning balance in AOCI was a gain of $60.
c. How would the converted cash flow statement differ if Sears Canada's functional currency was the U.S. dollar? Explain.

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SEARS CANADA INC. Comparative Balance Sheets January 29, 2011 c$ January 30, 2010 C$ (in millions) Assets Gashrcen Other current operating assets. Plant assets, net.PR 426 1,209 875 2,510 1,382 1,110 913 3,405 Liabilities and equity Accounts payable and accruals. Income taxes payable.. Long-term debt ..x.. 957 67 485 1,304 73 370 Capital stock..*... Retained earnings 1,509 15 986 1.747 15 1,643 1,001 Total stockholders' equityt Total liabilities and stockholders' equity.. 1,658 3,405 2,510 SEARS CANADA INC Statement of Income and Retained Earnings For Year Ended January 29, 2011 C$ 4,958 Cost of goods sold.. .(3,800) (833) (105) (70) 150 Retained earnings, January 30, 2010. 1,643 Operating expenses. Depreciation expense . .. Retained earnings, January 29, 2011. .. 986