All of the Following Statements Are Stated in Brazil Reals $30,20X5$

question 17

Multiple Choice

All of the following statements are stated in Brazil reals (R$) . Bralta Ltd.
Statement of Financial Position
Iune $30,20X5$ $$\begin{array} { | l | r | r | r | } \hline \text { Cash } & 60,000 & \text { Current liabilities } & 500,000 \\\hline \text { Accounts receivable } & 740,000 & \text { Bonds payable } & \underline { 2,000,000 } \\\hline \text { Inventories } & 300,000 & & 2,500,000 \\\hline \text { Machinery (net) } & 850,000 & \text { Common shares } & 1,000,000 \\\hline \text { Land and building (net) } & \underline { 1,800,000 } & \text { Retained earnings } & \underline { 250,000 } \\\hline & \underline { 3,750,000 } & & \underline { 3,750,000 } \\\hline\end{array}$$ Additional information:
Selected exchange rates:
$$\begin{array} { | l | l | } \hline \text { June } 30,20X4 & \text { R } \$ 1 = \$ 0.5906 \\\hline \text { June } 30,20 X5 & \text { R } \$ 1 = \$ 0.5623 \\\hline \text { Average for } 20X5 & \text { R } \$ 1 = \$ 0.5744 \\\hline\end{array}$$
$$\text { Date of purchase of inventory on hand at year-end } \quad \text { R } \$ 1 = \$ .05688$$
Dividends were declared on June 30, 20X5
Opening inventory = R$130,000
Inventory purchases for the year = R$1,570,000
Machinery, land, and buildings were purchased on June 30, 20X4
Bralta is the Brazilian subsidiary of Altapro Co., a Canadian company.
-Under the current-rate method, what is the translation gain or loss?

• A)$(85,610)
• B)$(35,375)
• C)$35,375
• D)$85,619

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Definitions:

Risk-averse

A characteristic of individuals or entities that prefer to avoid risk in investment choices, opting for safer, less uncertain options.

Fair Bet

A gambling term where the expected return is equal to the original stake, with no advantage for the house or the bettor.

Expected Value

The calculated average of all possible values for a random variable, weighted by their respective probabilities.

Risk-loving

A term describing an individual's preference or inclination towards taking risk, often in the pursuit of higher rewards.