On 1 January 2021 Ppp Ltd Incorporated A Subsidiary S Ltd For Fc 4 000 The Functional Currency Of S Ltd Is Fc And Th 1 (38.85 KiB) Viewed 105 times
On 1 January 2021 Ppp Ltd Incorporated A Subsidiary S Ltd For Fc 4 000 The Functional Currency Of S Ltd Is Fc And Th 2 (18 KiB) Viewed 105 times
On 1 January 2021, PPP Ltd incorporated a subsidiary, S Ltd, for FC 4,000. The functional currency of S Ltd is FC and therefore the financial statements of S Ltd are in FC. On the other hand, the functional and presentation currency of PPP Ltd is HK$. Before PPP Ltd prepares the consolidated financial statements, it needs to translate the financial statements of S Ltd into HK$. However, at year-end, an accountant has only found the exchange rates as below and prepared the financial information of Ltd in FC. Thus, the financial information of S Ltd in Hong Kong dollars has not been prepared. The exchange rates were: 1 January 2021 FC1 = HK$1.10 19 August 2021 FC1 = HK$1.15 31 December 2021 FC1 = HK$1.30 Average for 2021 FC1 - HK$1.08 Statement of profit or loss for the year ended 31 December 2021 FC Ex rate . HKS Revenue 8.000 ? ? ? Expenses (3.000) ? ? Net profit for the year 5,000 ? ? Dividend paid on 19/8/2021 (1.200) ? Retained profits 3,800 ? ? ? C.
Statement of financial position as at 31 December 2021 FC Ex. rate HKS Property, plant and equipment 4,300 ? ? ? Net current assets 3.500 7.800 ? Share capital 4,000 ? ? Retained profits 3,800 ? ? Exchange difference reserve ? ? 7.800 .... C. CCCC Requirement: Prepare the statement of financial position as at 31 December 2021 and the statement of profit or loss of S Ltd in Hong Kong Dollars for the year ended 31 December 2021.
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