In 2014, Ferguson Pumps Inc. (Ferguson) opened a facility (Le Pumps) in Europe, which builds and sells pumps throughout Europe. Ferguson sold inventory to Le Pumps; some of which remain in Le Pumps’ inventory at year-end. Ferguson Pumps capitalized Le Pumps and also lent Le Pumps money on both short-term and long-term bases. This case is structured in a multinational operating environment and requires students to: determine Le Pumps’ functional currency, translate financial statements into the U.S. Dollar, prepare all eliminating entries and intercompany adjustments along with consolidated statements, forgive debt, and list authoritative guidance under U.S. GAAP for all requirements. Key issues include foreign currency translation and transaction gains/losses, consolidation, and intercompany transactions.