A US-Owned Foreign Subsidiary Has the Following Beginning and Ending Stockholders

question 24

Essay

A U.S.-owned foreign subsidiary has the following beginning and ending stockholders' equity for 20X1:
The change in common stock resulted from a sale of stock to the parent firm on May 15. The change in retained earnings resulted from a July 1 dividend of 10,000 FC and net income for 20X1. Various exchange rates were as follows:
$\begin{array}{lc}\text { Date } & 1 \mathrm{FC} \text { equal to } \\\text { January } 1,20 \mathrm{X} 1 & \$ 1.10 \\\text { May } 15,20 \mathrm{X} 1 & \$ 1.12 \\\text { July } 1,20 \mathrm{X} 1 & \$ 1.13 \\\text { December } 31,20 \mathrm{X} 1 & \$ 1.15 \\\text { 20X1 average } & \$ 1.125\end{array}$ Required:
Compute the 20X1 translation adjustment for the foreign subsidiary.