PeraKo-PeraMo is a domestic financing institution which gives out loans to OFWs all around the globe.
Last Novem
30, 2020, the Company extended a $10,000, 12% interest bearing loan to Mrs. OFW to be paid in US Dollars on Jan
31, 2021. PeraKo-PeraMo utilizes a calendar year accounting period.
Exchange rates: $1=peso
11/30/2020 12/31/2020 1/31/2021
Selling 50.50 50.40 50.70
Buying 50.75 50.60 50.80
d the globe. Last November
paid in US Dollars on January
PeraKo-PeraMo is a domestic financing institution which gives out loans to OFWs all around the globe. Last Novem
2020, the Company extended a $10,000, 12% interest bearing loan to Mrs. OFW to be paid in US Dollars on Januar
2021. PeraKo-PeraMo utilizes a calendar year accounting period.
Exchange rates: $1=peso
11/30/2020 12/31/2020 1/31/2021
Selling 50.50 50.40 50.70
Buying 50.75 50.60 50.80
1. Intitial Recognition - 11/30/2020 3. Settlement Date- 1/31/2021
Loan Receivable 507,500.00 Loan Receivable 2,000.00
Cash 507,500.00 Forex Gain
2. Balance Sheet date- 12/31/2020 Interest Receivable 20.00
Forex Loss (1,500.00) Forex Gain
Loan Receivable (1,500.00)
Interest Receivable 5,080.00
Interest Receivable $ 100.00 Interest Income
Interest Income $ 100.00
Cash 518,160.00
Interest Receivable 5,060.00 Loan Receivable
Interest Income 5,060.00 Interest Receivable
ound the globe. Last November 30,
paid in US Dollars on January 31,
2,000.00
20.00
5,080.00
518,160.00
508,000.00
10,160.00
Company A owns a subsidiary in the United States whose statement of financial position in USD for the last two ye
below:
As of Dec 31, 2019 As of Dec 31,2020
Assets
Cash and Cash Equivalents $ 90,000.00 $ 75,000.00
Receivables 367,500.00 442,500.00
Inventory 480,000.00 510,000.00
PPE, net 765,000.00 690,000.00
Total Assets $ 1,702,500.00 $ 1,717,500.00
Liabilities and Equity Other Pertinent Info:
Accrued Expenses $ 165,000.00 $ 225,000.00 The Company formed its su
January 1, 2019. income of
Notes payable 967,500.00 855,000.00 was earned evenly through
Common Stock 345,000.00 345,000.00 The subsidiary declared div
Retained Earnings 225,000.00 292,500.00 $15,000 on October 26, 20
subsequently distributed o
Total Liabilities and Equity $ 1,702,500.00 $ 1,717,500.00 There were no dividends d
year 2020.
1. How much is the cumulative translation adjustment as of December 31, 2020?
2. How much is the translation adjustment for the year 2020?
3. How much the the cumulative translation adjustment as of December 31, 2019?
ncial position in USD for the last two years is shown
Exchange Rates:
January 1, 2019 $1= ₱ 45.00
December 31, 2019 $1= ₱ 42.50
December 31, 2020 $1= ₱ 47.50
Average 2019 $1= ₱ 43.75
October 26, 2019 $1= ₱ 40.00
January 2, 2020 $1= ₱ 41.50
Other Pertinent Info:
The Company formed its subsidiary on
January 1, 2019. income of the subsidiary
was earned evenly throughout the years.
The subsidiary declared dividends worth
$15,000 on October 26, 2019 which were
subsequently distributed on January 2, 2020.
There were no dividends declared for the
year 2020.
1. How much is the cumulative translation adjustment as of December 31, 2020?
2020: USD EXCHANGE RATE PESO
Total Assets
Total Liabilities
Total SHE, 2020 - - (Translated SHE)
Rolled SHE, 2020 - FULLY ROLLED METHOD
Common Stock - - -
Retained Earnings
1/1/2019
NI 2019 - -
Div 2019 - -
12/31/2019 -
NI 2020 - -
Div 2020 -
12/31/2020 -
Total SHE, 2020 - (Fully Rolled SHE)
Total SHE, 2020 - (Translated SHE)
Cummulative Adjustment as of December 31, 2020 -
2. How much is the translation adjustment for the year 2020?
2020: USD EXCHANGE RATE PESO
Total Assets
Total Liabilities
Total SHE, 2020 - - (Translated SHE)
Rolled SHE, 2020 -NET ASSET METHOD
Total SHE as of
-
12/31/2019
NI 2020 -
Div 2020 -
12/31/2020 - -
Total SHE, 2020 - (partially Rolled SHE)
Total SHE, 2020 - (Translated SHE)
Translation adjustment for the year 2020 -
1. How much is the cumulative translation adjustment as of December 31, 2020?
2020: USD EXCHANGE RATE PESO
Total Assets 1,717,500
Total Liabilities 1,080,000
Total SHE, 2020 637,500 47.50 30,281,250 (Translated SHE)
Rolled SHE, 2020- FULLY ROLLED METHOD
Common Stock 345,000 45.00 15,525,000
Retained Earnings
1/1/2019 -
NI 2019 240,000 43.75 10,500,000
Div 2019 (15,000) 40.00 (600,000)
12/31/2019 225,000 9,900,000
NI 2020 67,500 45.00 3,037,500
Div 2020 - -
12/31/2020 292,500 12,937,500
Total SHE, 2020 28,462,500 (Fully Rolled SHE)
Total SHE, 2020 30,281,250 (Translated SHE)
Cummulative Adjustment as of December 31, 2020 (1,818,750)
3. How much the the cumulative translation adjustment as of December 31, 2019?
Cummulative Adjustment
12/31/2019 1,200,000
for the year 2020 (3,018,750)
12/31/2020 (1,818,750)
2019: USD EXCHANGE RATE PESO
Total Assets 1,702,500
Total Liabilities 1,132,500
Total SHE, 2019 570,000 42.50 24,225,000 (Translated SHE)
Rolled SHE, 2020 -FULL ROLL
Common Stock 345,000 45.00 15,525,000
Retained Earnings
1/1/2019 -
NI, 2019 240,000 43.75 10,500,000
Div, 2019 (15,000) 40.00 (600,000)
12/31/2019 225,000 9,900,000
Total SHE, 2019 25,425,000 (Rolled SHE)
Total SHE, 2019 24,225,000 (Translated SHE)
Cumulative Adjustment for the year 2019 1,200,000
2. How much is the translation adjustment for the year 2020?
2020: USD EXCHANGE RATE PESO
Total Assets 1,717,500
Total Liabilities 1,080,000
Total SHE, 2020 637,500 47.50 30,281,250 (Translated SHE)
Rolled SHE, 2020 -NET ASSET METHOD
Total SHE as of
570,000 42.50 24,225,000
12/31/2019
NI 2020 67,500 45.00 3,037,500
Div 2020 - -
12/31/2020 292,500 3,037,500
Total SHE, 2020 27,262,500 (partially Rolled SHE)
Total SHE, 2020 30,281,250 (Translated SHE)
Translation adjustment for the year 2020 (3,018,750)
