The _____ Approach to Exchange Rates Emphasizes the Importance of the Supply

question 16

Multiple Choice

The _____ approach to exchange rates emphasizes the importance of the supply and demand for money as a key to understanding the determinants of exchange rates.

• A)purchasing-power-parity
• B)asset market
• C)monetary
• D)balance of payments

Analyze the effect of non-cash transactions and events on the statement of cash flows.

Calculate cash flows from operating activities using the indirect method.

Recognize the treatment of losses and gains from the sale of assets in the statement of cash flows.

Understand the indirect and direct methods for preparing the statement of cash flows.

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Definitions:

Gain on Realization

Profit recognized from selling an asset for more than its book value.

Loss or Gain

The financial result from business transactions, investments or other financial events, indicating a profit (gain) or a deficit (loss).

Realization Account

An account used in the process of dissolving a partnership or corporation, where the assets are converted into cash and liabilities are paid off.

Post-closing Account Balances

The balances of all ledger accounts after adjusting entries have been made and temporary accounts have been closed out at the end of an accounting period.