BCA Company was acquired by Farns Co. on December 14, 2021 for 4,000,000 Euros. The fair values of assets and liabilities are reflected above, in Euros. Since its acquisition on December 14, and through the end of the year on December 31, no transactions took place. Nothing.

At the time of acquisition on December 14, the exchange rate was 1 Euro = 1.10 US dollars. As of December 31, the exchange rate was 1 Euro = 1.23 US dollars. (Assume this is correct.)

Your assignment:

A. Assume the Euro is BCA's functional currency, translate BCA's statement of financial position as of 12/31/21 in the space provided above..

B. Assume the US dollar is BCA's functional currency, remeasure BCA's statement of financial position as of 12/31/21 in the space provided above.

Just to be clear, in Euros the statement of financial position as of 12/14/21 does not change. So the 12/31/21 statement (in Euros) is unchanged. But exchange rates did change.

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BCA Company A. Assuming Euro is functional B. Assuming US Dollar is functional currency. currency. Remeasurement 12/14/2021 Translation Rate US Dollars Rate US Dollars Cash Inventory Land and Building € 800,000 1,300,000 4,000,000 Total Assets € 6,100,000 Notes Payable Stockholders' Equity Translation/Remasurement Adjustment Total Liabilities and Equity € 2,100,000 4,000,000 6,100,000 If an income statement were prepared for the time period December 13 to December 31, what amount of income or expense would be included as a result of translation, and separately as a result of remeasurement? Hint, there is no other activity generating income or expense, just translation/remeasurement. A BCA Company A. Assuming Euro is functional B. Assuming US Dollar is functional currency. currency. Remeasurement 12/14/2021 Translation Rate US Dollars Rate US Dollars Cash Inventory Land and Building € 800,000 1,300,000 4,000,000 Total Assets € 6,100,000 Notes Payable Stockholders' Equity Translation/Remasurement Adjustment Total Liabilities and Equity € 2,100,000 4,000,000 6,100,000 If an income statement were prepared for the time period December 13 to December 31, what amount of income or expense would be included as a result of translation, and separately as a result of remeasurement? Hint, there is no other activity generating income or expense, just translation/remeasurement. A

Answer rating: 100% (QA)

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