If the Exchange Rate Changes from

question 91

Multiple Choice

If the exchange rate changes from .50 pounds per dollar to .75 pounds per dollar, what has happened to the dollar?

• A) It has appreciated and so buys more British goods.
• B) It has appreciated and so buys fewer British goods.
• C) It has depreciated and so buys more British goods.
• D) It has depreciated and so buys fewer British goods.

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Definitions:

Accumulated Depreciation

The total amount of depreciation expense that has been recorded for an asset since it was put into use, representing the wear and tear on the asset over time.

Balance Sheet Credit

Refers to any credit entry recorded in the balance sheet, indicating an increase in liabilities or equity or a decrease in assets.

Adjusted Trial Balance

A trial balance prepared after adjusting entries are made and posted, used to verify the equality of debits and credits.

Financial Statements

These are formal records that detail a company's financial activities and condition, typically including the balance sheet, income statement, and cash flow statement.