Foreign Corporation operates independently in the United States but is owned by a Philippine corporation. It reported the following in its USD-denominated financial statements submitted to its local regulators: Year 2 Bonds Payable $ 8,000.00 Ordinary Share Capital 10,000.00 Retained Earnings 2,240.00 Total Liabilities and Equity $20,240.00 Ordinary shares were issued when the exchange rate was P51.23. Retained Earnings balance as of the end of Year 1 had a translated value P111,000. During Year 2, dividends amounting to $500 were declared and paid when the exchange rate is P52.41.

Foreign Corporation operates independently in the United States but is owned by a Philippine corporation. It reported the following in its USD-denominated financial statements submitted to its local regulators: Year 2 Bonds Payable $ 8,000.00 Ordinary Share Capital 10,000.00 Retained Earnings 2,240.00 Total Liabilities and Equity $20,240.00 Ordinary shares were issued when the exchange rate was P51.23. Retained Earnings balance as of the end of Year 1 had a translated value P111,000. During Year 2, dividends amounting to $500 were declared and paid when the exchange rate is P52.41.

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter25: Taxation Of International Transactions

Section: Chapter Questions

Problem 25P

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