If an Imbalance Results from the Accounting Method Used for Translation

question 52

Multiple Choice

If an imbalance results from the accounting method used for translation, the imbalance is taken either to ________ or ________.

• A) the bank; the post office
• B) depreciation; the market for foreign exchange swaps
• C) current income; equity reserves
• D) current liabilities; equity reserves

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Definitions:

Market Price

The immediate rate at which assets or services are traded in the open market.

Par Common Stock

The nominal or face value of a share of common stock, as stated in the corporate charter.

Fair Market

The price at which a willing buyer and seller would agree to transact in an open and unrestricted market.

Common Stock

Common stock represents equity ownership in a corporation, where shareholders are entitled to vote on corporate matters and possibly receive dividends.