Problem:
Management of Boston Corp (U.S. Company) is trying to expand operations into Asia.A proposal has been made to acquire a Japaneses manufacturing company (Sonyo Enterprises) to meet this objective. The management of Boston has requested info on the dollar values that would appear on the consolidated financial statements if Boston acquires 100% of Sonyo for 1,111,500,000 Japanese yen. The exchange rate when this request is made is 1 yen = $.008 The following is the trial balance in Japanese yen for Sonyo Enterprises.
..............................................Book Value...................Market Value
Cash/Receivables.................125,000,000.................125,000,000
Inventory...............................200,000,000.................250,000,000
Plant & Equipment net..........640,000,000.................900,000,000
Patents.................................375,000,000.................450,000,000
Current liabilities ...................(187,500,000)...............(187,500,000)
Long term debt....................(300,000,000)................(300,000,000)
Common Stock.....................(62,500,000)
Retained Earnings...............(790,000,000)
Prepare a trial balance in U.S. Dollars at the date of acquisition.