Betan International has operations in Arrakis. The balance sheet for this divisi

Question

Betan International has operations in Arrakis. The balance sheet for this division in Arrakeen solaris shows assets of 29,000 solaris, debt in the amount of 10,500 saloris, and equity of 18,500 solaris. A) If the current exchange ratio is 1.39 solaris per dollar, what does the balance sheet look like in dollars? B) Assume that one year from now the balance sheet in solaris is exactly the same as at the beginning of the year. If the exchange rate is 1.54 solaris per dollar what does the balance sheet look like in dollars? C) Assume that one year from now the balance sheet is exactly the same as at the beginning of the year. If the eschange rate is 1.24 solaris per dollar, what does the balance sheet look like in dollars now?

Explanation / Answer

A Assets =29,000 Solaris = $29000/1.39=$20863.31

Debt= 10500 Solaris= $10,500/1.39= $7553.96

Equity = 18500 Solaris=$18,500/1.39= $13,309.35

B Assets =29,000 Solaris = $29000/1.54=$18,831.17

Debt= 10500 Solaris= $10,500/1.54= $6,818.18

Equity = 18500 Solaris=$18,500/1.54= $12,012.99

C Assets =29,000 Solaris = $29000/1.24=$23,387.10

Debt= 10500 Solaris= $10,500/1.24= $8,467.74

Equity = 18500 Solaris=$18,500/1.24= $14,919.35

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