Question

The OUI Company is a French Subsidiary of an American Company, YES
Below is the financial statements for 2020
		These statements are in Euros but following U.S. GAAP
		Balance Sheet			Income Statement
	Cash	100,000		revenue	200,000
	accounts rec	100,000		salary exp	-40000
	equipment	100,000		dep exp bldg	-30000
	a/d equip	-30,000		dep exp equip	-10,000
	building	100,000		gain sale land	40000
	a/d bldg	-40000
				net income	160,000
	total assets	330,000
				Other information:
	accounts pay	100000		when YES Company purchased OUI Company stock  1 euro = $1.25
				when OUI Company purchased  equipment  1 euro = $1.15
	c/s	200000		when OUI company purchased building 1 euro = $1.20
	r/e	30000		when OUI Company paid a 150,000 dividend 1 euro = $1.31
				when OUI Company sold the land  1 euro = $1.22
				On 12/31/2019 retained earnings in dollars  $42000
				Average exchange rate during 2020 1 euro = $1.27
				12/31/2020  spot rate:  1 euro = $1.24
REQUIRED:   WHEN THE DOLLAR IS THE FUNCTIONAL CURRENCY OF OUI COMPANY CONVERT THE STATEMENTS INTO DOLLARS

Answer 1

Balancesheet
Particulars	Amount $	Exchange Rate Used
Cash	$1,24,000	Spot Rate 31.12.2020
Account Recievable	$1,24,000	Spot Rate 31.12.2020
Equipment	$1,15,000	Transaction Rate of Equipment
Accumulated depreciation	($34,500)	Transaction Rate of Equipment
Building	$1,20,000	Transaction Rate of Building
Accumulated depreciation	($48,000)	Transaction Rate of Building
Total Asset	$4,00,500
Account Payable	$1,24,000	Spot Rate 31.12.2020
Common Stocks	$2,50,000	Transaction Rate of Company stock
Retained Earnings	($21,600)	Given Amount
Translation Adjustment	$48,100
Total Liabilities	$3,52,400
Income Statement
Revenue	$2,54,000	Average Rate
Salary Expenses	($50,800)	Average Rate
Depreciation Equipment	($34,500)	Transaction Rate of Equipment
Depreciation Building	($48,000)	Transaction Rate of Building
Gain on Sale of Land	$12,200	Rate on Sale
Net income	$1,32,900
Retained Earning Beg	$42,000	Given
Net Income	$1,32,900
Less:Dividends	$1,96,500
Retained Earning End	($21,600)