Millager Company is a U.S.-based multinational corporation with the U.S. dollar (USD) as its reporting currency. To prepare consolidated financial statements for 2015, the company must translate the accounts of its subsidiary in Mexico, Cadengo S.A. On December 31, 2014, Cadengo’s balance sheet was translated from Mexican pesos (MXN) (its functional currency) into U.S. dollars as prescribed by U.S. GAAP. Equity accounts at that date follow:

Early in 2015, Cadengo negotiated a 5,000 Brazilian real (BRL) loan from a bank in Rio de
Janeiro and established a sales office in Brazil.
At the end of 2015, Cadengo provided Millager a trial balance that includes all of Cadengo’s Mexican peso-denominated transactions for the year. A separate ledger has been maintained for transactions carried out by the Brazilian sales office that are denominated in BRL. A trial balance for the Brazilian real-denominated transactions follows Cadengo’s MXN trial balance.

RAZILIAN SALES OFFICE
Trial Balance
December 31, 2015

Additional Information
The Mexican peso exchange rate for 1 Brazilian real (MXN/BRL) and the U.S. dollar exchange rate for 1 Mexican peso (USD/MXN) during 2015 follow:

a. Using an electronic spreadsheet, prepare the Mexican peso trial balance for Cadengo S.A. for the year ending December 31, 2015. Verify the amount of remeasurement gain/loss derived as a plug figure in the spreadsheet through separate calculation.
b. Using a second electronic worksheet, translate Cadengo S.A.’s Mexican peso trial balance into U.S. dollars to facilitate Millager Company’s preparation of consolidated financial statements. Verify the amount of cumulative translation adjustment derived as a plug figure in the spreadsheet through separate calculation. Note: An additional row must be inserted in the trial balance for the remeasurement gain/loss calculated in parta.

December 31, 2014 Common stock Retained earnings.. Cumulative translation adjustment (debit balance) MXN USD 12,000,000 1,000,000 2,500,000 200,000 (39,572.50) CADENGO S.A. Trial Balance December 31, 2015 1 Debit Credit MXN 1,000,000 3,000,000 5,000,000 2,000,000 15,000,000 Cash Accounts receivable Inventory. Land Depreciable assets Accumulated depreciation Accounts payable Notes payable Common stock Retained earnings, 1/1/15. Sales Cost of goods sold. Depreciation expense Rent expense Interest expense Dividends, 7/1/15 Total . . . . MXN 6,000,000 1,500,000 4,000,000 12,000,000 2,500,000 34,000,000 28,000,000 600,000 3,000,000 400,000 2,000,000 MXN60,000,000 MXN60,000,000 Debit Credit Cash Accounts receivable Notes payable Sales Rent expense Interest expense Total BRL 5,500 28,000 BRL 5,000 35,000 6,000 500 BRL 40,000 BRL 40,000 Date MXN/BRL USD/MXN January 1, 2015 Average 2015 July 1, 2015 December 31, 2015 6.00 6.20 6.28 6.30 0.080 0.075 0.073 0.072