Download exercise of chapter 9 and more Exercises Financial Accounting in PDF only on Docsity!
Name: Trịnh Thị Hòa An Mssv: 19071279 Sunsquare Company was created as a wholly owned subsidiary of Times Corporation (a US based company) on January 1, 2021. On that date, Times Corporation invested USD50,000 in Sunsquare's capital stock. Given the exchange rate on that date of 1400 Won per USD. Sunsquare's Balance sheet at Jan 1, 2021 in Won as follows: Won Cash 70,000, Total assets 70,000, Capital stock 70,000, Total liabilities and equity 70,000, Relevant USD exchange rates for the Won for 2021 are as follows: January 1, 2021 1400 Won per USD Average for 2021 1420 Won per USD Rate when PPE were acquired and long- term debt was incurred on Jan 10, 2021 (^) 1410 Won per USD Working 1 Capital stock Won Exchange rate USD Rate when capital was increased Feb 25, (^2021) 1415 Won per USD Jan-01 70,000,000 1,400 50000 Rate when dividends were declared. Dec 1, 2021 1425 Won per USD Feb-25 30,000,000 1,415 21201 Average for the month of December 2021 (^) 1430 Won per USD Total 100,000,000 71201 December 31, 2021 1440 Won per USD Sunsquare's Won denominated financial statements for the year ended December 31, 2021 are as follows: a. Current rate method Won Exchange rate USD Sales 55,000,000 1,420 38, COGS (30,000,000) 1,420 (21,127) Selling and administrative expenses (11,000,000) 1,420 (7,746) Income statement for 2021 Balance sheet at Jan 1, 2021
Depreciation expense (1,000,000) 1,420 (704) Interest expense (2,000,000) 1,420 (1,408) Income before tax 11,000,000 Calculation 7, Income taxes (2,200,000) 1,420 (1,549.30) Net income 8,800,000 Calculation 6, Won Exchange rate USD Retained earnings, 1/1/2021 0 - Net income 8,800, From income statement 6, Dividend (4000000) 1,425 (2,807) Retained earnings, 31/12/2021 4,800,000 Calculation 3, Won Exchange rate USD Cash 30,000,000 1,440 20, Account receivable 15,000,000 1,440 10, Inventory 21,000,000 1,440 14, PPE 55,000,000 1,440 38, Accumulated depreciation (1,200,000) 1,440 (833) Total assets 119,800,000 Calculation 83, Liabilities Account payable 10,000,000 1,440 6, Long-term debt 5,000,000 1,440 3, Equity Capital stock 100,000,000 Working 1 71201 RE 4,800, From RE Statement (^) 3, Cummulative translation adjustment (1,814) Total Liabilties and Equity 119,800,000 83, Statement of Retained Earnings for 2021 Balance sheet at Dec 31, 2021 Rate when dividends were declared. Dec 1, 2021
Retained earnings statement for 2020
Won Exchange rate USD Note
Retained earnings, 1/1/2021 0 0
Net income Calculation 5,
Dividend (4,000,000) 1,425 (2,807)
Retained earnings, 31/12/ from balance sheet (^) 2,
Income statement for 2021
Won Exchange rate USD Note
Sales 55,000,000 1,420 38,732 Average for 2021
COGS (30,000,000) Working 2 50,
Selling and administrative expenses (11,000,000) 1,420 (7,746) Average for 2021
Depreciation expense (1,000,000) 1,410 (709) Rate applied for PPE
Interest expense (2,000,000) 1,420 (1,408) Average for 2021
Income before tax 11,000,000 Calculation 79,
Income taxes (2,200,000) 1,420 (1,549) Average for 2021
Translation adjustment
Net income 8,800,000 5,
Working 2 COGS Won Exchange rate USD
Beginning inventory 0 1,400 0 Jan-
Add: Purchase 51,000,000 1,420 35915 Average for 2021
Less: ending inventory 21,000,000 1,430 14685
Average rate for Dec 2021
Equal: COGS -30,000,000 50601
Rate when dividend were declared Dec 1, 2021
