Chapter 10-18 - CHAPTER 10 TRANSLATION OF FOREIGN CURRENCY...

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CHAPTER 10 TRANSLATION OF FOREIGN CURRENCY FINANCIAL STATEMENTS Answers to Problems Excel Case —Translating Foreign Currency Financial Statements 1.2. Spreadsheet for the translation (current rate method) and remeasurement (temporal method) of the FC financial statements of Charles Edward Company’s foreign subsidiary. Temporal Method Current Rate Method December 31, 2007 FC Rate USD Rate USD Sales 5,000 $0.45 A $2,250 $0.45 A $2,250 Cost of goods sold (3,000 ) calculation (1,360 ) $0.45 A (1,350 ) Gross profit 2,000 subtotal 890 subtotal 900 Selling expense (400) $0.45 A (180) $0.45 A (180) Depreciation expense (600) $0.50 H (300) $0.45 A (270) Remeasurement gain/loss 0 to balance 355 n/a 0 Income before tax 1,000 subtotal 765 subtotal 450 Income taxes (300 ) $0.45 A (135 ) $0.45 A (135 ) Net income 700 subtotal 630 subtotal 315 Retained earnings, 1/1/07 0 0 0 Retained earn, 12/31/07 700 from B/S 630 total 315 Cash 1,000 $0.38 C 380 $0.38 C 380 Inventory 2,000 $0.43 H 860 $0.38 C 760 Fixed assets 6,000 $0.50 H 3,000 $0.38 C 2,280 Less: accum/deprec (600 ) $0.50 H (300 ) $0.38 C
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This note was uploaded on 02/08/2012 for the course ACCOUNTING 559 taught by Professor Keating during the Spring '07 term at DeVry Addison.

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Chapter 10-18 - CHAPTER 10 TRANSLATION OF FOREIGN CURRENCY...

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