Homework Answers
b if foreign currency depreciates, the foreign exchange gain is created
actually in case of depreciation of other countries currency, the value of currency falls. This would mean that the buyer will pay more and hence exchange gains occur.
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AUS. company sells merchandise to a foreign company denominated in US dollars. Which of the following statements...
A U.S. company sells merchandise to a foreign company denominated in U.S. dollars. Which of the...
A U.S. company sells merchandise to a foreign company denominated in U.S. dollars. Which of the following statements is true? A) If the foreign currency depreciates, a foreign exchange loss will result. B) No foreign exchange gain or loss will result. C) If the foreign currency depreciates, a foreign exchange gain will result. D) If the foreign currency appreciates, a foreign exchange loss will result E) If the foreign currency appreciates, a foreign exchange gain will result.
Which of the following statements is true? None of the others A foreign exchange gain arising...
Which of the following statements is true? None of the others A foreign exchange gain arising from translating financial statements should always be recorded as revenue. The term ‘foreign currency transaction’ refers to a transaction denominated in a currency other than Australian dollars. The translation gain or loss on a foreign operation using the current rate method represents the effect of exchange rate movements on net assets.
QUESTION 3 Select all of the following that are true regarding interest rates and foreign exchange...
QUESTION 3 Select all of the following that are true regarding interest rates and foreign exchange rates: When domestic interest rates rise the domestic currency depreciates When a domestic currency depreciates, domestic interest rates rise Interest rate parity between countries is a reasonable assumption due to arbitrage and floating exchange rates When domestic interest rates rise due to monetary policy, the domestic currency appreciates solely because of the decreased supply of the domestic currency QUESTION 4 Select all that are...
1. In regards to the perspective of a U.S. investor, which of the below statements is...
1. In regards to the perspective of a U.S. investor, which of the below statements is FALSE? Group of answer choices a.The cash flows of assets denominated in a foreign currency expose the investor to uncertainty as to the actual level of the cash flow measured in that foreign currency. b.The actual number of U.S. dollars that the investor eventually gets depends on the exchange rate between the U.S. dollar and the foreign currency at the time the nondollar cash...
Please solve for multiple choice in images. Question 19 5 pts Xena Corporation has a foreign...
Please solve for multiple choice in images.
Question 19 5 pts Xena Corporation has a foreign subsidiary, Zeta Corporation, located in Japan. At the end of fiscal 2016, Zeta has: Non-monetary assets Monetary assets Non-monetary liabilities Monetary liabilities 55 million Yen 20 million Yen 30 million Yen 25 million Yen Assume Xena uses the current rate method for translating Zeta's financial statements from the yen into U.S. dollars. If the yen appreciates relative to the dollar, which of the following...
The following are the foreign currency positions of an FI, expressed in the foreign currency: Currency...
The following are the foreign currency positions of an FI, expressed in the foreign currency: Currency Assets Liabilities FX Bought FX Sold Swiss franc (Sf) Sf 132,600 Sf 54,570 Sf 12,750 Sf 17,850 British pound (£) £ 42,500 £ 21,500 £ 15,500 £ 22,000 Japanese yen (¥) ¥ 8,200,000 ¥ 3,500,000 ¥ 1,600,000 ¥ 9,100,000 The exchange rate of dollars for Sf is 1.02, of dollars for British pound is 1.31, and of dollars for yen is .00953. The following...
The following are the foreign currency positions of an H. expressed in the foreign currency Currency Swiss franc...
The following are the foreign currency positions of an H. expressed in the foreign currency Currency Swiss franc (SE) British pound (£) Japanese yen (Y) Assets Sf 127,500 38,168 17,869,885 Liabilities Sf 51,000 £ 16,794 43, 147,954 FX Bought SE 10, 200 £ 11,450 Y1, 259, 181 EX Sold SE 15,300 £ 15,267 79, 233, 998 The exchange rate of dollars for Sfis 1.02, of dollars for British pound is 131, and of dollars for yen is 0.00953. The following...
on june 2018, company a sells a mining equipment to a foreign company with the corresponding...
on june 2018, company a sells a mining equipment to a foreign company with the corresponding receivable to be paid on july 1 of the same year.the equipment has a selling price of $150,000 and a cost of $135,000.on june 1,the foreign currency is worth $1.35. company a uses the perpetual inventory system. Requirement:prepare all necessary journal entries to record the sale and purchase respectively on the book of the both companies under the following assumptions. A.The transaction is denominated...
Meilly Company, a Canadian company, sold merchandise inventory on account to a company in Long Beach,,...
Meilly Company, a Canadian company, sold merchandise inventory on account to a company in Long Beach,, California, for US$800,000 on March 1, 2019, with payment due on April 1, 2019. The following exchange rates existed on the dates significant for accounting purposes: March 1, 2019, spot rate April 1, 2019, spot rate March 1, 2019, forward 30-day rate US$1.00 C$e.98 US$1.00 c$1.03 US$1.00 $1.05 If Meilly Company did not hedge its receivable, what would be the exchange gain/loss? Multiple Choice...
24. Which of the following statements is correct? a. The functional currency must always be...
24. Which of the following statements is correct? a. The functional currency must always be the currency of the US parent company. b. Non-US subsidiaries always record transactions in $US. c. If the foreign-currency-denominated subsidiary financial statements are already in the functional currency, but not in the parent’s currency, then the financial information must be “translated” into the parent’s currency. d. None of the above
QUESTION 3 Select all of the following that are true regarding interest rates and foreign exchange rates: When domestic interest rates rise the domestic currency depreciates When a domestic currency depreciates, domestic interest rates rise Interest rate parity between countries is a reasonable assumption due to arbitrage and floating exchange rates When domestic interest rates rise due to monetary policy, the domestic currency appreciates solely because of the decreased supply of the domestic currency QUESTION 4 Select all that are...
Please solve for multiple choice in images.
Question 19 5 pts Xena Corporation has a foreign subsidiary, Zeta Corporation, located in Japan. At the end of fiscal 2016, Zeta has: Non-monetary assets Monetary assets Non-monetary liabilities Monetary liabilities 55 million Yen 20 million Yen 30 million Yen 25 million Yen Assume Xena uses the current rate method for translating Zeta's financial statements from the yen into U.S. dollars. If the yen appreciates relative to the dollar, which of the following...
The following are the foreign currency positions of an H. expressed in the foreign currency Currency Swiss franc (SE) British pound (£) Japanese yen (Y) Assets Sf 127,500 38,168 17,869,885 Liabilities Sf 51,000 £ 16,794 43, 147,954 FX Bought SE 10, 200 £ 11,450 Y1, 259, 181 EX Sold SE 15,300 £ 15,267 79, 233, 998 The exchange rate of dollars for Sfis 1.02, of dollars for British pound is 131, and of dollars for yen is 0.00953. The following...
Meilly Company, a Canadian company, sold merchandise inventory on account to a company in Long Beach,, California, for US$800,000 on March 1, 2019, with payment due on April 1, 2019. The following exchange rates existed on the dates significant for accounting purposes: March 1, 2019, spot rate April 1, 2019, spot rate March 1, 2019, forward 30-day rate US$1.00 C$e.98 US$1.00 c$1.03 US$1.00 $1.05 If Meilly Company did not hedge its receivable, what would be the exchange gain/loss? Multiple Choice...
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