In: Accounting
The following account balances are for the Agee Company as of January 1, 2015, and December 31, 2015. All figures are denominated in kroner (Kr). |
January 1, 2015 | December 31, 2015 |
|
Accounts payable | (9,000) | (19,000) |
Accounts receivable | 34,000 | 84,000 |
Accumulated depreciation—buildings | (25,000) | (30,000) |
Accumulated depreciation—equipment | 0 | (5,500) |
Bonds payable—due 2018 | (55,000) | (55,000) |
Buildings | 114,000 | 95,000 |
Cash | 40,000 | 8,500 |
Common stock | (64,000) | (78,000) |
Depreciation expense | 0 | 20,000 |
Dividends (10/1/15) | 0 | 37,000 |
Equipment | 0 | 35,000 |
Gain on sale of building | 0 | (6,500) |
Rent expense | 0 | 17,000 |
Retained earnings | (35,000) | (35,000) |
Salary expense | 0 | 25,000 |
Sales | 0 | (100,000) |
Utilities expense | 0 | 7,500 |
Additional Information |
• |
Agee issued additional shares of common stock during the year on April 1, 2015. Common stock at January 1, 2015, was sold at the start of operations in 2004. |
• |
It purchased buildings in 2005 and sold one building with a book value of Kr 14,000 on July 1 of the current year. |
• | Equipment was acquired on April 1, 2015. |
Relevant exchange rates for 1 Kr were as follows: |
2004 | $ | 2.65 |
2005 | 2.45 | |
January 1, 2015 | 2.75 | |
April 1, 2015 | 2.85 | |
July 1, 2015 | 3.05 | |
October 1, 2015 | 3.15 | |
December 31, 2015 | 3.25 | |
Average for 2015 | 2.95 | |
a. |
Assuming the U.S. dollar is the functional currency what is the remeasurement gain or loss for 2015? |
b. |
Assuming the foreign currency is the functional currency what is the translation adjustment for 2015? |