Sunset Technological, Inc

question 21

Essay

Sunset Technological, Inc., a U.S. multinational producer of computer hardware, has subsidiaries located throughout the world. Sunset Technology purchased Werner Technology Company, a Swiss producer of computer hardware components, on January 1, 2010. Werner's financial statements are prepared and submitted in Swiss francs to Sunset's headquarters. Werner's adjusted trial balance at December 31, 2011, is presented below:
Werner Technology Company
Adjusted Trial Balance
December 31, 2011
(in Swiss Francs)

Relevant exchange rates for 2011 and 2010 are as follows:

The statement of retained earnings for the year ended December 31, 2010, is as follows (in U.S. dollars):

Required:
Prepare a translated statement of income and retained earnings, and a translated statement of financial position in U.S. dollars for Werner Technology for 2011.

Comprehend the effects of fiscal policies on the budget deficit and national debt.

Identify the role of automatic stabilizers in the federal budget and their impact on the economy.

Analyze the implications of different budget philosophies on economic stability and growth.

Distinguish between annually, cyclically, and functionally balanced budgets and their economic rationales.

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Definitions:

Net Income

The total profit or loss of a company after all expenses, taxes, and costs have been subtracted from total revenue.

Fixed Cost

A cost that does not change with an increase or decrease in the number of goods or services produced or sold.

Production Costs

Direct costs associated with the manufacturing of goods, including labor, materials, and overhead expenses.

Variable Manufacturing Costs

Expenses that vary directly with the level of production, such as raw materials and labor.