Jeremy Bastanta Ginting

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1.
Soo company, Ltd.
Translation Worksheet for 2011

British Exchange US Dollars

Pounds Rate ($) ($)
Debit
Cash 20,000 1.65 C 33,000
Account Receivable-net 70,000 1.65 C 115,500
Inventories 50,000 1.65 C 82,500
Equipment 800,000 1.65 C 1,320,000
Cost of sales 350,000 1.63 A 570,500
Depreciation expenses 80,000 1.63 A 130,400
Operating expenses 100,000 1.63 A 163,000
Dividends 30,000 1.62 R 48,600
1,500,000 2,463,500
Credits
Accumuluted depreciation 330,000 1,65 C 544,500
Accounts payable 70,000 1,65 C 115,500
Capital stock 400,000 1,60 H 640,000
Retained earnings 100,000 measured 160,000
Sales 600,000 1.63 978,000
Equity adjustment from translation 1,500,000 2,438,000

2. Journal entries for 2011

January 1, 2011
Investment in Soo $800,000
Cash $800,000
To record purchase of Soo at Book value

During 2011
Cash $48,600
Investment in Soo $48,600
To record dividends from soo

December 31, 2011

Investment in Soo $139,600
Income from Soo $114,100
Equity adjustment from translation $ 25,500

Check :
Investment in Soo $800,000 Capital stock £400,000
Dividends $(48,600) Retained Earnings 1/1 £100,000
Income from Soo $114,100 Add : Income £70,000
Equity adjustment $25,500 Less : Dividends £(30,000)
Jeremy Bastanta Ginting
008201700019

Investment in Soo $891,000 Stockholders equity £540,000

  Current rate $1.65
$891,000

3.
Beginning book value Net Asset 50,000 pounds x ($1.65 - $1.60) $2,500
Add : Net Income 70,000 pounds x ($1.65 - $1.63) $1,400
Less : Dividends 30,000 pounds x ($1.65 - $1.62) $ (900)
Effect of exchange rate changes on net assets $3,000