Translate into dollars the balance sheet ofWyomingWyomingLeather? Goods\'GermanG
ID: 2437815 • Letter: T
Question
Translate into dollars the balance sheet ofWyomingWyomingLeather? Goods'GermanGermansubsidiary. WhenWyomingWyoming Leather Goods acquired the foreign? subsidiary, a euro was worth ?$1.06 The current exchange rate is ?$1.340. During the period when retained earnings were? earned, the average exchange rate was ?$1.17 per euro.
1. During the period covered by this? scenario, which currency was? stronger, the dollar or the? euro?
Begin by translating the balance sheet of WyomingWyoming Leather? Goods' GermanGerman subsidiary into U.S. dollars.
German Subsidiary:
Exchange
Euros
Rate
Dollars
Assets
800,000
Liabilities
200,000
Stockholders' equity:
Common stock
85,000
Retained earnings
515,000
Foreign-currency
translation adjustment
800,000
1072000
German Subsidiary:
Exchange
Euros
Rate
Dollars
Assets
800,000
Liabilities
200,000
Stockholders' equity:
Common stock
85,000
Retained earnings
515,000
Foreign-currency
translation adjustment
800,000
1072000
Explanation / Answer
The complete table would look like the following after converting to $ on the basis of given exchange rate.
Euros Exchange Rate Dollars Assets € 800,000.00 $ 1.34 $ 1,072,000.00 Liabilities € 200,000.00 $ 1.34 $ 268,000.00 Stockholders' equity: Common stock € 85,000.00 $ 1.34 $ 113,900.00 Retained earnings € 515,000.00 $ 1.17 $ 602,550.00 Foreign-currency translation adjustment $ 87,550.00 TOTAL € 800,000.00 $ 1,072,000.00Related Questions
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