Foreign subsidiary financial statements

Assignment Help Financial Management

Reference no: EM131933679

1. If a company uses the temporal method for translating its foreign subsidiary's financial statements, which of the following accounts is exposed?

A. Accounts payable

B. Capital stock

C. Net plant and equipment

D. Inventory

2. NVT (U.S.A.) is a multinational corporation. It operates subsidiaries in four countries. For translation purposes, which of the following countries is considered hyperinflationary?

A. Country M: inflation2014 = 30%, inflation2015 = 38%, inflation2016 = 27%

B. Country Q: inflation2014 = 29%, inflation2015 = 38%, inflation2016 = 32%

C. Country G: inflation2014 = 10%, inflation2015 = 8%, inflation2016 = 5%

D. Country J: inflation2014 = 40%, inflation2015 = 38%, inflation2016 = 51%

Reference no: EM131933679

Questions Cloud

Should better lease the equipment from financial perspective : What is the cost to Better if it purchased the equipment? Should Better lease the equipment from a financial perspective?

Consultant to help them estimate their cost of capital : Angell Inc. hired you as a consultant to help them estimate their cost of capital. If firm raise new common equity, how much higher will Angell Inc.’s WACC be.

Current market price of the stock reflects intrinsic value : Assuming current market price of the stock reflects its intrinsic value as computed using constant-growth DDM, what rate of return do Nogro’s investors require?

Company just entered very profitable growth mode : The company just entered a very profitable growth mode and expects that its dividend will grow 15% annually over the next three years.

Foreign subsidiary financial statements : If a company uses the temporal method for translating its foreign subsidiary's financial statements, which of the following accounts is exposed?

Which of the events results in transaction exposure : For a U.S. company, which of the following events results in transaction exposure?

Calculate the subsidiary translation exposure in INR : The average spot rate in 2016 was INR 45/USD. The Indian interest rate was 8.15%. Calculate the subsidiary's translation exposure in INR.

Five circumstances under which monetary policy instruments : Discuss five circumstances under which the monetary policy instruments may not be effective in controlling money supply.

Gains or losses caused by translation adjustments : Gains or losses caused by translation adjustments when using the temporal method are ________.

User Account

All Pages