REFERENCE: Ref.10_12 Ginvold Co.began Operating a Subsidiary in a Foreign Country on Country

question 31

Essay

REFERENCE: Ref.10_12
Ginvold Co.began operating a subsidiary in a foreign country on January 1,2008 by acquiring all of the common stock for §50,000.This subsidiary immediately borrowed §120,000 on a five-year note with ten percent interest payable annually beginning on January 1,2008.A building was then purchased for §170,000.This property had a ten-year anticipated life and no salvage value and was to be depreciated using the straight-line method.The building was immediately rented for three years to a group of local doctors for §6,000 per month.By year-end,payments totaling §60,000 had been made.On October 1,§5,000 were paid for a repair made on that date.A cash dividend of §6,000 was transferred back to Ginvold on December 31,2008.The functional currency for the subsidiary was the stickle.Currency exchange rates were as follows:
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-Prepare a statement of retained earnings for this subsidiary in stickles and then translate these amounts into U.S.dollars.

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Definitions:

Radiation Type

Describes the various forms of energy emitted from a source, such as alpha, beta, gamma rays, and X-rays.

Decay Particles

The smaller particles or energy emitted from a nucleus during radioactive decay.

Half-life

The time required for a quantity to reduce to half its initial value, commonly used in nuclear physics to describe the decay of radioactive substances.

Alpha Particle

A type of radioactive emission consisting of two protons and two neutrons, equivalent to a helium nucleus.