USE THE FOLLOWING FOR THE NEXT 2 PROBLEMS Munich Bratwerst Company Balance Sheet
ID: 2456058 • Letter: U
Question
USE THE FOLLOWING FOR THE NEXT 2 PROBLEMS
Munich Bratwerst Company
Balance Sheet
Dec-31 2016
In EU's
Cash
$ 10,000.00
Accts Rec
$ 40,000.00
Inventory
$ 50,000.00
Equip Net
$ 100,000.00
Land
$ 400,000.00
Tot Asset
$ 600,000.00
Acct Payable
$ 50,000.00
Common Stock
$ 400,000.00
Retain Earnings
$ 150,000.00
Income Statement
For the year 2016
Sales
$ 1,500,000.00
COGS
$ 800,000.00
Gross Profit
$ 700,000.00
Depreciation Expense
$ 100,000.00
Operating Expense
$ 510,000.00
Net Income
$ 90,000.00
Dividends of 40,000 EU paid 6/30 when 2EU=$1
(December 31, 2016)
4EU = $1
(Average 2016)
3EU =$1
(June 1, 1998 when stock was acquired)
1EU = $1
(October 1, 1998 when equip was purchased)
1.5EU = $1
(December 31, 2000 when land was purchased)
2EU = $1
(Retained Earnings January 1, 2016)
$68,000
1) PREPARE A DOLLAR DENOMINATED: INCOME STATEMENT, BALANCE SHEET AND STATEMENT OF EQUITY IF THE DOLLAR IS THE FUNCTIONAL CURRENCY (TEMPORAL METHOD)
2) PREPARE A DOLLAR DENOMINATED: INCOME STATEMENT, BALANCE SHEET AND STATEMENT OF EQUITY IF THE EURO IS THE FUNCTIONAL CURRENCY (CURRENT RATE METHOD)
Munich Bratwerst Company
Balance Sheet
Dec-31 2016
In EU's
Cash
$ 10,000.00
Accts Rec
$ 40,000.00
Inventory
$ 50,000.00
Equip Net
$ 100,000.00
Land
$ 400,000.00
Tot Asset
$ 600,000.00
Acct Payable
$ 50,000.00
Common Stock
$ 400,000.00
Retain Earnings
$ 150,000.00
Income Statement
For the year 2016
Sales
$ 1,500,000.00
COGS
$ 800,000.00
Gross Profit
$ 700,000.00
Depreciation Expense
$ 100,000.00
Operating Expense
$ 510,000.00
Net Income
$ 90,000.00
Dividends of 40,000 EU paid 6/30 when 2EU=$1
(December 31, 2016)
4EU = $1
(Average 2016)
3EU =$1
(June 1, 1998 when stock was acquired)
1EU = $1
(October 1, 1998 when equip was purchased)
1.5EU = $1
(December 31, 2000 when land was purchased)
2EU = $1
(Retained Earnings January 1, 2016)
$68,000
Explanation / Answer
1) PREPARE INCOME STATEMENT, BALANCE SHEET AND STATEMENT OF EQUITY A DOLLAR DENOMINATED IF THE DOLLAR IS THE FUNCTIONAL CURRENCY (TEMPORAL METHOD)
2) PREPARE INCOME STATEMENT, BALANCE SHEET AND STATEMENT OF EQUITY A DOLLAR DENOMINATED IF THE EURO IS THE FUNCTIONAL CURRENCY (CURRENT RATE METHOD)
30000
Balance Sheet 31 Dec 2016 Munich Bratwerst Company Amount in EU $ Amount in $ at temporal Method (4EU=1$) CASH 10000 2500 ACCTS RECEIVABLES 40000 10000 INVENTORY 50000 12500 EQUIPMENT NET 100000 25000 LAND 400000 100000 TOTAL ASSETS 600000 150000 ACCTS PAYABLE 50000 12500 COMMON STOCK 400000 100000 RETAINED EARNINGS 150000 37500 600000 150000Related Questions
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