On January 1,20X8,Pullman Corporation Acquired 75 Percent Interest in Steamship

Multiple Choice

On January 1,20X8,Pullman Corporation acquired 75 percent interest in Steamship Company for $300,000.Steamship is a Norwegian company.The recording currency is the Norwegian kroner (NKr) .The acquisition resulted in an excess of cost-over-book value of $25,000 due solely to a patent having a remaining life of 5 years.Pullman uses the fully adjusted equity method to account for its investment.Steamship's December 31,20X8,trial balance has been translated into U.S.dollars,requiring a translation adjustment debit of $8,000.Steamship's net income translated into U.S.dollars is $35,000.It declared and paid an NKr 20,000 dividend on June 1,20X8.Relevant exchange rates are as follows:
Assume the kroner is the functional currency.
-Based on the preceding information,in the journal entry to record parent's share of subsidiary's translation adjustment:

A) Other Comprehensive Income-Translation Adjustment will be debited for $8,000.
B) Other Comprehensive Income-Translation Adjustment will be credited for $6,000.
C) Investment in Steamship Company will be credited for $6,000.
D) Investment in Steamship Company will be debited for $8,000.