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Whohauser Is a U

question 8

Multiple Choice

Whohauser is a U.S.-based forest products firm. In June Whohauser delivers a shipment of raw lumber to Japan. The ¥55,000,000 receivable is due in 180 days. The firm's foreign exchange advisors believe the yen will be at about ¥115/$ then. The current spot rate is ¥110/$. Whohauser has received a 180 day forward quote of ¥108/$. If the company does nothing and the exchange rate goes to ¥115 as expected, how much will the firm receive in dollars in 180 days? Is this cash flow risky or known with certainty today?

Understand the distinction between temporary and permanent accounts and their roles in the accounting cycle.

Comprehend the purpose and process of adjusting entries in the preparation of financial statements.

Learn the correct order of steps in the accounting cycle.

Identify and correct errors within the accounting cycle.

Definitions:

Written Promise

A formal pledge, often in the form of a document, affirming that one party agrees to perform or refrain from a specific action.

Short-term Receivables

Financial claims to cash due from customers or clients within one year, typically arising from the sale of goods or services on credit.

Current Assets

Resources anticipated to be transformed into cash, disposed of, or utilized within a year or throughout the usual cycle of business operations.

Percentage of Sales

A financial ratio that compares a company's profitability, expanses, or other financial indicators to its total sales, often expressed as a percentage.