Topic: translation and remeasurement gains and losses on january 1, 2020, a hong kong subsidiary was acquired by a u. s. company. the subsidiary’s trial balances for the beginning and end of 2020 appear below, in hong kong dollars (hk$): january 1, 2020 december 31, 2020 dr (cr) dr (cr) cash and receivables hk$ 2,000 hk$ 1,600 plant assets, net 10,000 9,000 liabilities (9,000) (7,100) capital stock (500) (500) retained earnings, beginning (2,500) (2,500) sales revenue (8,000) depreciation expense 1,000 other operating expenses _6,500 hk$ 0 hk$ 0 sales revenue and other operating expenses occurred evenly during 2020. exchange rates (u. s. dollars/hk$) are as follows: january 1, 2020 $0.120 average for 2020 0.130 december 31, 2020 0.136

required

a. the subsidiary’s functional currency is the hong kong dollar. calculate the translation gain or loss for 2020. specify whether it is a gain or loss.

b. the subsidiary’s functional currency is the u. s. dollar. calculate the remeasurement gain or loss for 2020. specify whether it is a gain or loss.

Nell and kirby are in the process of negotiating their divorce agreement. what should be the tax consequences to nell and kirby if the following, considered individually, became part of the agreement? a. in consideration for her one-half interest in their personal residence, kirby will transfer to nell stock with a value of $200,000 and $50,000 of cash. kirby's cost of the stock was $150,000, and the value of the personal residence is $500,000. they purchased the residence three years ago for $300,000.nell's basis for the stock is $ xkirby's basis in the house is $ xb. nell will receive $1,000 per month for 120 months. if she dies before receiving all 120 payments, the remaining payments will be made to her estate. the payments (qualify, do not qualify) as alimony and are (included in, excluded from) nell's gross income as they are received. c. nell is to have custody of their 12-year-old son, bobby. she is to receive $1,200 per month until bobby (1) dies or (2) attains age 21 (whichever occurs first). after either of these events occurs, nell will receive only $300 per month for the remainder of her life.$ x per month is alimony that is (included in, excluded from) nell's gross income, and the remaining $ x per month is considered (child support, property settlement) and is (nontaxable, taxable) to nell.