Instructions – PLEASE READ THEM CAREFULLY The Assignment must be submitted on Bl

Instructions – PLEASE READ THEM CAREFULLY
The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
All answers must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism.
Submissions without this cover page will NOT be accepted.
Assignment Question(s): Three Questions Each Carries 5 Marks) (total Marks 15)
Q1. The following information extracted from the parent company
a.Parent company loaned $1000 to Subsidiary with an interest rate of 5%.
b.Parent company made a sale to Subsidiary for $500 cash. The inventory had originally cost Parent company $200. Subsidiary then sold that same inventory to an outsider for $700.
c.Parent company made a sale to Sub for $800 cash. The inventory had originally cost Parent $300. Subsidiary has not yet sold that same inventory to an outsider.
Required:
Pass the elimination entries for the intercompany transactions.
Answer:
Q2. Explain the differences between translation and remeasurement of financial statements of a foreign subsidiary.
Answer:
Q3. The partnership of Ibrahim and Rawan has the following provisions:
Ibrahim and Rawan receive salary allowances of SAR 50,000 and SAR 15,000, respectively.
Interest is imputed at 5% on the average capital investment.
Any remaining profit or loss is shared between Ibrahim and Rawan in a 3:1 ratio, respectively.
Average Capital investments: Ibrahim, SAR 300,000; Rawan, SAR 150, 000 Net income SAR 300,000
Required:pass journal entry to allocate the profit between Ibrahim and Rawan