When a US Company Purchases a Foreign Company, the Transaction Is Recorded

question 174

Multiple Choice

When a U.S. company purchases a foreign company, the transaction is recorded in the balance of payments as part of:

• A)the current account.
• B)the financial and capital account.
• C)the statistical discrepancy.
• D)net transfers.

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Definitions:

Selling Price

The amount a company charges for its product or service, which can impact demand, revenue, and profitability.

Direct Materials

Raw materials that can be directly identified with the production of specific goods or services.

Variable Cost

Costs that vary directly with the level of production or volume of operations.

Sales Volume

The quantity of products or services sold by a business within a specific time period.