Problem

Certain balance sheet accounts of a foreign subsidiary of Rose Company have been stated in...

Certain balance sheet accounts of a foreign subsidiary of Rose Company have been stated in U.S. dollars as follows:

 

Stated at

 

Current Rates

Historical Rates

Accounts receivable, current

$200,000

$220,000

Accounts receivable, long term

100,000

110,000

Prepaid insurance

50,000

55,000

Goodwill

80,000

85,000

 

$430,000

$470,000

This subsidiary’s functional currency is the U.S. dollar. What total should Rose’s balance sheet include for the preceding items?

a.  $430,000.

b.  $435,000.

c.   $440,000.

d.  $450,000.

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Solutions For Problems in Chapter 10