Under the Current Rate Method of Translating Foreign Currency Financial

question 16

Multiple Choice

Under the current rate method of translating foreign currency financial statements,what exchange rate should be used for cost of goods sold?

• A)spot rate at the end of the year
• B)average rate during the year
• C)spot rate mid-year
• D)There is no single rate because beginning and ending inventory must be converted at different exchange rates than purchases.

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Definitions:

Federal Budget Deficit

The financial shortfall when a government's expenditures exceed its revenues within a fiscal year.

National Debt

The total amount of money that a country's government has borrowed, usually as a result of spending more than it receives in income.

Trillion

A numerical value representing a thousand billion, or 1,000,000,000,000, commonly used in discussing government budgets, economic indicators, and astronomical distances.

Public Debt

The amount of federal securities outstanding, which represents what the federal government owes (the accumulation of federal deficits minus surpluses over the last two centuries).