Question

On December 18, 2017, Stephanie Corporation acquired 100 percent of a Swiss company for 4.0 million Swiss francs (CHF), which is indicative of book and fair value. At the acquisition date, the exchange rate was $100 CHF 1. On December 18, 2017, the book and fair values of the subsidiary's assets and liabilities were: 1,318,006 4,810,800 (2,128,000) Property, plant & equipment Stephanie prepares consolidated financial statements on December 31, 2017 By that date, the Swiss franc has appreciated to $1.10 CHF 1. Because of the year-end holidays, no transactions took place prior to consolidation. a. Determine the translation adjustment to be reported on Stephanie's r 31, 2017, consolidated balance sheet, assuming that the Swiss franc is the Swiss subsidiary's functional currency. What is the economic relevance of this translation Edjustment? dollar is the functional currency. What is the economic relevance of this remeasurement gain or loss? b. Determine the remeasurement gain or loss to be reported in Stephanie's 2017 consolidated net income, assuming that the U.S

Answer 1

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