CHAPTER 48_FINL REPTG IN HYPERINFLATIONARY ECONOMIES.pdf -...

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100 Chapter 48 – Financial Reporting in Hyperinflationary Economies Multiple Choice - Theory 1. D 2. D 3. A 4. D 5. A Multiple choice – Computational (SET A) Answers at a glance: 1. B 6. C 11. A 16. B 2. B 7. D 12. D 3. C 8. B 13. D 4. D 9. A 14. B 5. B 10. D 15. C Solutions: 1. B 2. B (650,000 + 400,000) = 1,050,000 3. C Solution: Net proceeds 400,000 Restated carrying amt. (300K x 140/120) (350,000) Gain on sale 50,000 4. D Solution: Net proceeds 200,000 Restated carrying amt. (300K x 140/100* x 6/10) (252,000) Gain on sale 52,000 * The problems states that the general price indices are as of the end of each year and that the equipment was purchased on January 1, 20x6. Thus, the denominator used is 100 – the general price index on December 31, 20x5. 5. B Solution:
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