Certain Balance Sheet Accounts of a Foreign Subsidiary of Parker

question 92

Multiple Choice

Certain balance sheet accounts of a foreign subsidiary of Parker Company at December 31, 2021, have been restated into U.S. dollars as follows: Assuming the functional currency of the subsidiary is the local currency, what total should be included in Parker's consolidated balance sheet at December 31, 2021, for the above items?

• A) $407,500.
• B) $418,000.
• C) $396,000.
• D) $403,500.
• E) $398,500.

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Definitions:

Market Equilibrium Price

The price at which the quantity of goods supplied equals the quantity of goods demanded in the market.

Normal Profit

The level of profit that is just sufficient to keep an entrepreneur in business, equaling total revenues minus explicit and implicit costs.

Price System

An economic mechanism wherein prices are determined by the interaction of supply and demand, guiding the allocation of resources and distribution of goods and services.

Scarce Goods

Items that are limited in availability relative to the desires or needs of consumers.