Question #101

Reading: Reading 10 Multinational Operations

PDF File: Reading 10 Multinational Operations.pdf

Page: 57

Status: Unattempted

Part of Context Group: Q101-103 First in Group
Shared Context
- Jameson would like to examine WB's group accounts. What is the most appropriate exchange rate (yen/$) to use in translating Kasamatsu's reported dividends into U.S. dollars? A) 150. B) 140. C) 145.
Question
If Jameson wishes to convert any of the figures on Kasamatsu's Income Statement from yen to dollars, she should most appropriately use which of the following exchange rates (yen/$)?
Answer Choices:
A. 140
B. 145
C. 150
Explanation
Under the current rate method, all items in the income statement would be translated at the average rate or 140JPY/USD. Because this question is asking only for translating sales, the average rate would be used even under the temporal method.
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