Problem

Remeasurement with Strengthening U.S. DollarRefer to the data in Exercise E12-5, but now a...

Remeasurement with Strengthening U.S. Dollar

Refer to the data in Exercise E12-5, but now assume that the exchange rates were as follows:

January 1

SFr1 =

$0.80

March 1

SFr1 =

0.77

November 1

SFr1 =

0.74

December 31

SFr1 =

0.73

20×1 average

SFr1 =

0.75

The receivable from Popular Creek is denominated in Swiss francs. Its books show a $3,650 payable to RoadTime.

Assume that the U.S. dollar is the functional currency.

Required

a.Prepare a schedule remeasuring the December 31, 20X1, trial balance from Swiss francs to dollars.


b.Compare the results of Exercise E12-7, in which the dollar weakens against the Swiss franc during 20X1, with the results in this exercise (E12-10), in which the dollar strengthened against the Swiss franc during 20X1.

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