Livingston Company is a wholly owned subsidiary of Rose Corporation. Livingston operates in a foreign country...
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Livingston Company is a wholly owned subsidiary of Rose Corporation. Livingston operates in a foreign country with financial statements recorded in pounds (P), the company's functional currency. Financial statements for the year 2020 are as follows: Sales Income Statement For Year Ending December 31, 2020 P 270,000 Cost of goods sold (155,000) Gross profit 115,000 Less: Operating expenses (54,000) Gain on sale of equipment 10,000 Net income P 71,000 Statement of Retained Earnings For Year Ending December 31, 2020 Retained earnings, 1/1/20 Less: Dividends P 216,000 71,000 (26,000) Net income Retained earnings, 12/31/20 P 261,000 Assets Balance Sheet December 31, 2020 Cash Receivables Inventory Property, plant, and equipment (net) Total assets Liabilities and Equities Liabilities Common stock Retained earnings, 12/31/20 Total liabilities and equities P 44,000 116,000 58,000 339,000 P 557,000 P 176,000 120,000 261,000 P 557,000 Additional Information The common stock was issued in 2013 when the exchange rate was $2.08 per pound; property, plant, and equipment was acquired in 2014 when the rate was $2.00 per pound. As of January 1, 2020, the retained earnings balance was translated as $396,520. The U.S. dollar-per-pound exchange rates for 2020 follow: January 1 April 1 September 1 December 31 $1.67 1.61 1.72 1.54 Weighted average 1.59 Inventory was acquired evenly throughout the year. The December 31, 2019, balance sheet reported a translation adjustment with a debit balance of $85,000. Dividends were declared on April 1, 2020, and a piece of equipment was sold on September 1, 2020. Assume that the pound is Livingston Company's functional currency. Translate the 2020 foreign currency financial statements into the parent's reporting currency, the U.S. dollar. Complete this question by entering your answers in the tabs below. Income Statement Retained Earnings Balance Sheet Prepare an Income Statement. (Amounts to be deducted and negative amounts should be indicated with a minus sign.) LIVINGSTON COMPANY Income Statement For the Year Ending December 31, 2020 0 0 Income Statement Retained Balance Sheet Earnings Prepare Statement of Retained Earnings. LIVINGSTON COMPANY Statement of Retained Earnings For the Year Ending December 31, 2020 Retained earnings, 1/1 Net income Retained earnings, 12/31 0 Income Statement Retained Earnings Balance Sheet Prepare a Balance Sheet. (Amounts to be deducted and negative amounts should be indicated with a minus sign.) Assets: LIVINGSTON COMPANY Balance Sheet December 31, 2020 Total assets Liabilities and Equities: 0 Total liabilities and equities 0 Livingston Company is a wholly owned subsidiary of Rose Corporation. Livingston operates in a foreign country with financial statements recorded in pounds (P), the company's functional currency. Financial statements for the year 2020 are as follows: Sales Income Statement For Year Ending December 31, 2020 P 270,000 Cost of goods sold (155,000) Gross profit 115,000 Less: Operating expenses (54,000) Gain on sale of equipment 10,000 Net income P 71,000 Statement of Retained Earnings For Year Ending December 31, 2020 Retained earnings, 1/1/20 Less: Dividends P 216,000 71,000 (26,000) Net income Retained earnings, 12/31/20 P 261,000 Assets Balance Sheet December 31, 2020 Cash Receivables Inventory Property, plant, and equipment (net) Total assets Liabilities and Equities Liabilities Common stock Retained earnings, 12/31/20 Total liabilities and equities P 44,000 116,000 58,000 339,000 P 557,000 P 176,000 120,000 261,000 P 557,000 Additional Information The common stock was issued in 2013 when the exchange rate was $2.08 per pound; property, plant, and equipment was acquired in 2014 when the rate was $2.00 per pound. As of January 1, 2020, the retained earnings balance was translated as $396,520. The U.S. dollar-per-pound exchange rates for 2020 follow: January 1 April 1 September 1 December 31 $1.67 1.61 1.72 1.54 Weighted average 1.59 Inventory was acquired evenly throughout the year. The December 31, 2019, balance sheet reported a translation adjustment with a debit balance of $85,000. Dividends were declared on April 1, 2020, and a piece of equipment was sold on September 1, 2020. Assume that the pound is Livingston Company's functional currency. Translate the 2020 foreign currency financial statements into the parent's reporting currency, the U.S. dollar. Complete this question by entering your answers in the tabs below. Income Statement Retained Earnings Balance Sheet Prepare an Income Statement. (Amounts to be deducted and negative amounts should be indicated with a minus sign.) LIVINGSTON COMPANY Income Statement For the Year Ending December 31, 2020 0 0 Income Statement Retained Balance Sheet Earnings Prepare Statement of Retained Earnings. LIVINGSTON COMPANY Statement of Retained Earnings For the Year Ending December 31, 2020 Retained earnings, 1/1 Net income Retained earnings, 12/31 0 Income Statement Retained Earnings Balance Sheet Prepare a Balance Sheet. (Amounts to be deducted and negative amounts should be indicated with a minus sign.) Assets: LIVINGSTON COMPANY Balance Sheet December 31, 2020 Total assets Liabilities and Equities: 0 Total liabilities and equities 0
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Related Book For
Advanced Accounting
ISBN: 9781264798483
15th Edition
Authors: Joe Ben Hoyle, Thomas Schaefer And Timothy Doupnik
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