A parent company (U.S.), on January 2, 2020, purchased a 100% interest in a subdivision located...

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A parent company (U.S.), on January 2, 2020, purchased a 100% interest in a subdivision located in Germany. Sales were earned and operating expenses were incurred evenly during the year. Exchange rates for the euro at various dates are: January 2, 2020 December 31, 2020 1.322 1.365 Average for 2020 Dec. 10, 2020, dividends declared & 1.345 paid 1.350 30-Jun-2017 1.212 20-May-2018 1.281 Required: Translate the year-end financial statements of the foreign subsidiary using the temporal method (Round numbers to the nearest dollar). Translation of Financial Statements to U.S. Dollars For Year Ended December 31, 2020 Income Statement euro Exc. Rate U.S. Dollars $ Revenues 525,000 $ Depreciation (20,000) $ Operating exp. excld. Depreciation (360,000) $ Translation G/L $ Net income 145,000 Statement of Retained Earnings $ Beginning retained earnings 270,000 $ Net income 145,000 Dividends declared and paid (55,000) $ $ Ending retained earnings 360,000 Balance Sheets $ Cash 100,000 $ Accounts receivable 205,000 Plant and equipment (net) (purchased 5/20/2018) 200,000 $ $ Land (purchased 6/30/2017) 125,000 $ Total Assets 630,000 Accounts payable 80.000 $ $ Long-term N/P (issued 5/20/2018) 100,000 $ Common stock (issued 6/30/2017) 90,000 Retained earnings 360,000 $ Total Liabilities & Equity 630,000 $ A parent company (U.S.), on January 2, 2020, purchased a 100% interest in a subdivision located in Germany. Sales were earned and operating expenses were incurred evenly during the year. Exchange rates for the euro at various dates are: January 2, 2020 December 31, 2020 1.322 1.365 Average for 2020 Dec. 10, 2020, dividends declared & 1.345 paid 1.350 30-Jun-2017 1.212 20-May-2018 1.281 Required: Translate the year-end financial statements of the foreign subsidiary using the temporal method (Round numbers to the nearest dollar). Translation of Financial Statements to U.S. Dollars For Year Ended December 31, 2020 Income Statement euro Exc. Rate U.S. Dollars $ Revenues 525,000 $ Depreciation (20,000) $ Operating exp. excld. Depreciation (360,000) $ Translation G/L $ Net income 145,000 Statement of Retained Earnings $ Beginning retained earnings 270,000 $ Net income 145,000 Dividends declared and paid (55,000) $ $ Ending retained earnings 360,000 Balance Sheets $ Cash 100,000 $ Accounts receivable 205,000 Plant and equipment (net) (purchased 5/20/2018) 200,000 $ $ Land (purchased 6/30/2017) 125,000 $ Total Assets 630,000 Accounts payable 80.000 $ $ Long-term N/P (issued 5/20/2018) 100,000 $ Common stock (issued 6/30/2017) 90,000 Retained earnings 360,000 $ Total Liabilities & Equity 630,000 $

Answer rating: 100% (QA)

Euro Rate Dollars Income Statement Revenues 525000 1345 706125 Depreciation 2... View the full answer