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What amount the foreign subsidiary cost of goods sold have

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Reference no: EM133041119

Question - A U.S. company's foreign subsidiary had the following amounts in Euros in 2011:

Cost of goods sold €40,000

Ending inventory 2,000

Beginning inventory 800

Suppose inventory is valued at cost. The average exchange rate during 2011 was € 1 = $1.44. The beginning inventory was acquired when the exchange rate was € 1 = $1.8. The ending inventory was acquired when the exchange rate was € 1 = $1.35. The exchange rate at December 31, 2011 was € 1 = $.1.26.

Under the temporal method, at what amount should the foreign subsidiary's cost of goods sold have been reflected in the 2011 U.S. dollar income statement?

a. $58,068

b. $56,268

c. $58,248

d. $57,888

Reference no: EM133041119

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