Aerkion Company starts 2013 with two assets: cash of 19,000 LCU (local currency

Question

Aerkion Company starts 2013 with two assets: cash of 19,000 LCU (local currency units) and land that originally cost 70,000 LCU when acquired on April 4, 2005. On May 1, 2013, Aerkion rendered services to a customer for 33,000 LCU, an amount immediately paid in cash. On October 1, 2013, the company incurred an 19,800 LCU operating expense that was immediately paid. No other transactions occurred during the year. Currency exchange rates for 1 LCU follow:


April 4, 2005 LCU 1 = $ 0.32
January 1, 2013 1 = 0.33
May 1, 2013 1 = 0.34
October 1, 2013 1 = 0.35
Average for 2013 1 = 0.36
December 31, 2013 1 = 0.39

Assume that Aerkion is a foreign subsidiary of a U.S. multinational company that uses the U.S. dollar as its reporting currency. Assume also that the LCU is the subsidiary

Explanation / Answer

Titan Aeration Company Pvt. Ltd. "Aeration Process: Aeration is the process by which air is circulated through, mixed with or dissolved in a liquid or substance. Aeration is the process by which the area of contact between water and air is increased, either by natural methods or by mechanical devices. Aeration is one of the most elemental techniques frequently employed in the improvement of the physical and chemical characteristics of water.The role of aeration in the activated sludge process is to provide oxygen to the microorganisms as they assimilate the organic carbon compounds and digest a portion of them to carbon dioxide and water, Sulfate and Nitrate compounds. The remaining waste solids are changed to a form that can be settledand removed as sludge by sedimentation.

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