Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions. The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

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Answer 1

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Chapter 12, Problem 12.11E

(a)

To determine

Introduction: Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

(b)

To determine

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

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ABC Company sold Euro 80 of goods to XYZ Company on credit on May 1. Terms were 20/5, n/60. PART A The accounting period of the company coincides with the calendar year. In this section, please assume XYZ paid the balance due on May 4. In light of this, net sales reported on ABC's income statement are Euro...... Place your answer here: PART B In this section, please assume XYZ returned on May 2, Euro 5 of defective goods, and then paid the outstanding balance due on May 16. In light of this, net sales reported on ABC's income statement are Euro... Place your answer here:

Basil plc, the British subsidiary of a U.S. company reported cost of goods sold in Great Britain Pounds for the current year ended December 31. The beginning inventory was £18800, and the ending inventory was £13100. Purchases of £27600 were made evenly throughout the year. Spot rates for various dates are as follows: Date the beginning inventory was acquired Rate at the start of the year £1 = $1.11 £1 = $1.10 £1 = $1.14 £1 = $1.19 Average rate for the year Date the ending inventory was acquired Assume that the Great Britain Pound is the functional currency of the British subsidiary. Given the facts above, the amount of cost of goods sold, restated in US $, that should appear in the consolidated income statement is: BE SURE TO TYPE A SIMPLE NUMBER WITH NO COMMAS OR DOLLAR SIGNS. FOR EXAMPLE, TYPE 1000 INSTEAD OF $1,000. Vour Answer:

24.) Stuff Company is a subsidiary of Pland Corporation and is located in Madrid, Spain, where the currency is the euro (€). Data on Stuff’s inventory and purchases are as follows: Inventory, January 1, 20X7 € 227,000 Purchases during 20X7 860,000 Inventory, December 31, 20X7 192,000 The beginning inventory was acquired during the fourth quarter of 20X6, and the ending inventory was acquired during the fourth quarter of 20X7. Purchases were made evenly over the year. Exchange rates were as follows: Fourth quarter of 20X6 € 1 = $ 1.29015 January 1, 20X7 € 1 = $ 1.32030 Average during 20X7 € 1 = $ 1.39655 Fourth quarter of 20X7 € 1 = $ 1.45000 December 31, 20X7 € 1 = $ 1.47280 Required: Show the remeasurement of cost of goods sold for 20X7, assuming that the U.S. dollar is the functional currency. Note: Round your intermediate calculations and final answer to nearest dollar amount. Show the translation of cost of goods sold for 20X7, assuming that the euro is…

Answer 2

Question

Chapter 12, Problem 12.11E

(a)

To determine

Introduction: Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

(b)

To determine

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Expert Solution & Answer

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Answer 3

Question

Chapter 12, Problem 12.11E

(a)

To determine

Introduction: Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

(b)

To determine

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Expert Solution & Answer

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Answer 4

Question

Chapter 12, Problem 12.11E

(a)

To determine

Introduction: Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

(b)

To determine

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Expert Solution & Answer

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Answer 5

Chapter 12, Problem 12.11E

(a)

To determine

Introduction: Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

(b)

To determine

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Answer 6

Chapter 12, Problem 12.11E

(a)

To determine

Introduction: Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

Answer 7

Chapter 12, Problem 12.11E

(a)

To determine

Introduction: Re-measurement of currency means revaluing the foreign currency or assets on company’ financial books. It is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

The re-measurement of cost of goods sold for 20X7 taking U.S dollar as a functional currency.

Answer 8

(b)

To determine

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Answer 9

(b)

To determine

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Answer 10

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Answer 11

Expert Solution & Answer

Answer 12

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Answer 13

Ch. 12 - Prob. 12.1Q Ch. 12 - Prob. 12.2Q Ch. 12 - Prob. 12.3Q Ch. 12 - How widely used are IFRS? Can IFRS be used for...Ch. 12 - Prob. 12.5Q Ch. 12 - Prob. 12.6Q Ch. 12 - Prob. 12.7Q Ch. 12 - Prob. 12.8Q Ch. 12 - Prob. 12.9Q Ch. 12 - Prob. 12.10Q

Solution Summary: The author explains how re-measurement of currency is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Want to see the full answer?

Chapter 12 Solutions

Solution Summary: The author explains how re-measurement of currency is useful for a parent company having investment in its subsidiaries and also have intercompany transactions.

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company. The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.

Want to see the full answer?

Chapter 12 Solutions

Introduction: Translation of foreign current is converting the financial values of subsidiary company to the reporting currency of parent company.

The translation of cost of goods sold for 20X7 taking Euro (€) as a functional currency.