on december 31 year 1 precision manufacturing inc pmi of edmonton purchased 100 of the outstanding ordinary shares of sandora corp/

Additional Information
Exchange rates
Dec. 31, Year 1 …… US$1 =CDN$1.10
Sep. 30, Year 2 …… US$1 = CDN$1.07
Dec. 31, Year 2 …… US$1 = CDN$1.05
Average for Year 2 … US$1 =CDN$1.08
Sandora declared and paid dividends on September 30, Year 2.
The inventories on hand on December 31, Year 2, were purchased when the exchange rate was US$1 = CDN$1.06.
Required:
(a) Assume that Sandora’s functional currency is the Canadian dollar:
(i) Calculate the Year 2 exchange gain (loss) that would result from the translation of Sandora’s financial statements.
(ii) Translate the Year 2 financial statements into Canadian dollars.
(b) Assume that Sandora’s functional currency is the U.S. dollar:
(i) Calculate the Year 2 exchange gain (loss) that would result from the translation of Sandora’s financial statements and would be reported in other comprehensive income.
(ii) Translate the Year 2 financial statements into Canadian dollars.
(c) Which functional currency would Sandora prefer to use if it wants to show the following:
(i) The strongest solvency position for the company
(ii) The best return on shareholders equity
Briefly explain your answers.