A Canadian subsidiary of a U.S. parent firm is instructed to bill an export to the parent in U.S. dollars. The Canadian subsidiary records the accounts receivable in Canadian dollars and notes a profit on the sale of goods
Later, when the U.S. parent pays the subsidiary the contracted U.S. dollar amount, the Canadian dollar has appreciated 10% against the U.S. dollar. In this example, the Canadian subsidiary will record a:
A) 10% foreign exchange loss on the U.S. dollar accounts receivable.
B) 10% foreign exchange gain on the U.S. dollar accounts receivable.
C) Since the Canadian firm is a U.S. subsidiary, neither a gain nor loss will be recorded.
D) Any gain or loss will be recorded only by the parent firm.
Answer: A
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Honda has invested $550 million in building an assembly plant in Greensburg, Indiana; IKEA spent nearly $2 billion to open stores in Russia; and South Korea's LG Electronics purchased a 58% stake in Zenith Electronics. All of these are examples of:
A) acquisition. B) licensing. C) franchising. D) FDI. E) exporting.
Answer the following statements true (T) or false (F)
1. The Hofstede culture dimensions have been invalidated with time and replaced by Project GLOBE. 2. China is a long-term oriented country, meaning that the culture focuses primarily on the past and present and immediate gratification. 3. Expatriates are individuals who have given up their citizenship in their native country. 4. When it comes to international assignments, accurate communication can be difficult even with a common language. 5. Hiring others from outside the organization to perform work worldwide is known as contract manufacturing.
A homeowner desires to sell his or her home and signs an exclusive-agency listing agreement, requiring payment of a six percent commission to the real estate agent. If shortly thereafter, before the agent has time to do anything to sell the property, the owner surprisingly finds a couple who purchases it for $400,000, the homeowner
a. must pay a commission of $24,000 to the listing agent. b. is not obligated to pay a commission. c. is not obligated to pay a commission, unless the agent has placed the listing in the local multiple-listing service. d. must pay a commission of $12,000, but is entitled to retain the other half because he or she found the buyer.
_____ is a feature of electronic meeting systems that combines the advantages of video teleconferencing and real-time computer conferencing
Fill in the blank(s) with correct word