Prepare a schedule translating the December 31, 20X1, trial balance from Swiss francs to dollars.
Prepare a proof of the translation adjustment.
Where is the translation adjustment reported on Popular Creek’s consolidated financial statements and its foreign subsidiary?
Prepare a schedule remeasuring the December 31, 20X1, trial balance from Swiss francs to dollars.
Prepare a proof of the remeasurement gain or loss .
How should this remeasurement gain or loss be reported on Popular Creek’s consolidated financialstatements and its foreign subsidiary?

On January 1, 20X1, Popular Creek Corporation organized RoadTime Company as a subsidiary in
Switzerland with an initial investment cost of Swiss francs (SFr) 60,000. RoadTime’s December 31,
20X1, trial balance in SFr is as follows:
Debit Credit
Cash SFr 7,000
Accounts Receivable (net) 20,000
Receivable from Popular Creek 5,000
Inventory 25,000
Plant and Equipment 100,000
Accumulated Depreciation SFr 10,000
Accounts Payable 12,000
Bonds Payable 50,000
Common Stock 60,000
Sales 150,000
Cost of Goods Sold 70,000
Depreciation Expense 10,000
Operating Expense 30,000
Dividends Paid 15,000
Total SFr 282,000 SFr 282,000

Additional Information
1. The receivable from Popular Creek is denominated in Swiss francs. Popular Creek’s books show a$4,000 payable to RoadTime.
2. Purchases of inventory goods are made evenly during the year. Items in the ending inventory were purchased November 1.
3. Equipment is depreciated by the straight-line method with a 10-year life and no residual value. A full year’s depreciation is taken in the year of acquisition. The equipment was acquired on March 1.
4. The dividends were declared and paid on November 1.
5. Exchange rates were as follows:
January 1 SFr1  $.73
March 1 SFr1  .74
November 1 SFr1  .77
December 31 SFr1  .80
20X1 Average SFr1  .75
6. The Swiss franc is the functional currency.

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Here is the answer I came up with. Please check for accuracy.Thanks!
RoadTime Company
Trial Balance Remeasurement
December 31, 20X1

Swiss U.S.
Francs Rate Dollars

Cash SFr 7,000 .80 $ 5,600
Accounts Receivable (net) 20,000 .80 16,000
Receivables from Popular Creek 5,000 .80 4,000
Inventory 25,000 .77 19,250
Plant and Equipment 100,000 .74 74,000
Cost of Goods Sold 70,000 (a) 52,000
Depreciation Expense 10,000 .74 7,400
Operating Expense 30,000 .75 22,500
Dividends Paid 15,000 .77 11,550
Total SFr 282,000 $212,300
Remeasurement Loss 1,000
Total Debits $213,300

Accumulated Depreciation SFr 10,000 .74 $ 7,400
Accounts Payable 12,000 .80 9,600
Bonds Payable 50,000 .80 40,000
Common Stock 60,000 .73 43,800
Sales 150,000 .75 112,500
Total Credits SFr 282,000 $213,300


Swiss U.S.
(a) Cost of Goods Sold: Francs Rate Dollars

Beginning Inventory SFr -0- .75 $ -0-
Purchases 95,000 .75 71,250
Goods Available for Sale SFr 95,000 $ 71,250
Less: Ending Inventory (25,000) .77 (19,250)
Cost of Goods Sold SFr 70,000 $ 52,000