advanced final - Question 1 1 points Save Perez Company a...

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Question 1 1 points Save Perez Company, a Mexican subsidiary of a U.S. company, sold equipment costing 200,000 pesos with accumulated depreciation of 75,000 pesos for 140,000 pesos on March 1, 2009. The equipment was purchased on January 1, 2008, when the exchange rate for the peso was $.11. Relevant exchange rates for the peso are as follows: Picture The financial statements for Perez are re-measured by its U.S. parent. What amount of gain or loss would be reported in its translated income statement? Question 1 answers $1,530 $1,575 $1,465 $1,090 $1,650 Question 2 text Question 2 1 points Save Which of the following items is considered to be the most significant impediment to accounting harmonization? Question 2 answers Nationalism Lack of accounting knowledge Language differences High cost of harmonization Question 3 text Question 3 1 points Save What basis does the International Accounting Standards Board use in formulating its IFRS? Question 3 answers Detailed rules to govern accounting practice A framework of accounting principles Typical tax laws of western nations Exceptions or unusual circumstances that require special attention Question 4 text Question 4 1 points Save Car Corp. (a U.S.-based company) sold parts to a Korean customer on December 16, 2008, with payment of 10 million Korean won to be received on January 15, 2009. The following exchange rates applied: Picture Assuming a forward contract was entered into, what would be the net impact on Car Corp.'s 2008 income statement related to this transaction? Assume an annual interest rate of 12% and a fair value hedge. The present value for one month at 12% is .9901. Question 4 answers $700 gain
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$700 loss $300 gain $300 loss $295.05 loss Question 5 text Question 5 1 points Save Which accounts are re-measured using current exchange rates? Question 5 answers All revenues and expenses All assets and liabilities All monetary assets and liabilities All current assets and liabilities All non-current assets and liabilities Question 6 text Question 6 1 points Save Certain balance sheet accounts of a foreign subsidiary of the Tulip Co. had been stated in U.S. dollars as follows: Picture If the U.S. dollar is the functional currency of this subsidiary, what total should have been included in Tulip's balance sheet for the items above? Question 6 answers $609,000 $658,000 $602,000 $630,000 $616,000 Question 7 text Question 7 1 points Save Which of the following statements is true about accounting harmonization? Question 7 answers Harmonization would increase the comparability of financial statements. Harmonization would reduce the cost of financial reporting for companies whose securities are listed on international exchanges. Harmonization would increase access to less expensive capital.
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This note was uploaded on 05/10/2011 for the course ACCOUNTING 49904 taught by Professor Aw during the Spring '11 term at University of Houston.

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advanced final - Question 1 1 points Save Perez Company a...

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