A US Parent Firm, as Result of Its Business Activities in in Germany

question 47

Multiple Choice

A U.S. parent firm, as result of its business activities in Germany, has a net exposure of €1,000,000. The consolidated reports were prepared at the year-end for the last two successive years. If the exchange rates on these reporting dates changed from $1.00 = €1.10 to $1.00 = €1.00, then the translation exposure report will indicate a "reporting currency imbalance" of

• A)$90,910.
• B)$0.
• C)-$90,910.
• D)none of the above

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Definitions:

Difficulties

Challenges or obstacles that make tasks hard to accomplish.

Activities

Tasks, actions, or operations that people engage in, often for enjoyment, learning, or achieving a goal.

Dorsal Root

The part of a spinal nerve that carries sensory neural signals to the spinal cord from the peripheral organs.

Sensory Nerve Impulses

Electrical signals generated by sensory receptors that convey information from the sensory organs to the brain.