Question 5 On January 1, 2019, TATA Systems, a U S based company, purchased a controlling interest in Weely Management Consultants located in Zurich, Switzerland January 1 December 31 Cash and Receivable 2,500 6,875 Net property , Plant Equipment 5,000 4,625 Total 7,500 11,500 Accounts Payable 3,750 4,000 Common Stock 2,500 2,500 Retained Earnings 1,250 5,000 Total 7,500 11,500 Revenues 9,375 Operating Expenses (including Deprecation 750) 3 750 Net Income 5,626 Dividends declared paid 1,875 Increase in Retained Earnings 3,750 Direct exchange rates for Swiss franc are Dollars per Franc January 1, 2018 $ 5987 December 31, 2018 5321 Average for 2018 5654 Dividend declaration and payment date 5810 Required Translate the year end balance sheet and income statement of the foreign subsidiary using 1 The current rate method of translation 2 Convert (re measure) the financial statements of the foreign subsidiary using the temporal method of translation

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Question: Question 5: On January 1, 2019, TATA Systems, a U.S.-based company, purchased a controlling interest in Weely Management Consultants located in Zurich, Switzerland. January 1

Question 5: On January 1, 2019, TATA Systems, a U.S.-based company, purchased a controlling interest in Weely Management Consultants located in Zurich, Switzerland.

	January 1	December 31
Cash and Receivable	2,500	6,875
Net property , Plant &Equipment	5,000	4,625
Total	7,500	11,500

Accounts Payable	3,750	4,000
Common Stock	2,500	2,500
Retained Earnings	1,250	5,000
Total	7,500	11,500

Revenues	9,375
Operating Expenses (including Deprecation 750)	3.750
Net Income	5,626
Dividends declared & paid	1,875
Increase in Retained Earnings	3,750

Direct exchange rates for Swiss franc are:

Dollars per Franc

January 1, 2018 $.5987

December 31, 2018 .5321

Average for 2018 .5654

Dividend declaration and payment date .5810

Required: Translate the year-end balance sheet and income statement of the foreign subsidiary using

1. The current rate method of translation

2. Convert (re measure) the financial statements of the foreign subsidiary using the temporal method of translation

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