A USCompany's Foreign Subsidiary Had the Following Amounts in Stickles (§),The

question 52

Multiple Choice

A U.S.company's foreign subsidiary had the following amounts in stickles (§) ,the functional currency,in 2018:
$$\begin{array} { l r } \text { Cost of goods sold } & \S 12,000,000 \\\text { Ending inventory } & 600,000 \\\text { Beginning inventory } & 240,000\end{array}$$
The average exchange rate during 2018 was §1 = $.96.The beginning inventory was acquired when the exchange rate was §1 = $1.20.The ending inventory was acquired when the exchange rate was §1 = $.90.The exchange rate at December 31,2018 was §1 = $.84.At what amount should the foreign subsidiary's cost of goods sold have been reflected in the 2018 U.S.dollar income statement?

• A)$11,253,600.
• B)$11,577,600.
• C)$11,520,000.
• D)$11,613,600.
• E)$11,523,600.

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Definitions:

Cognitive Consistency

Cognitive consistency is a psychological theory that proposes individuals desire to maintain a consistent set of beliefs, attitudes, and behaviors to reduce psychological discomfort.

Naïve Scientist

A concept in social psychology suggesting that individuals try to understand the social world using attribution processes similar to how a scientist would, making inferences and hypotheses based on observations.

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Cognitive processes and structures that influence and are influenced by social behaviour.

Social Behaviour

Actions and reactions exhibited by individuals within a social context, usually governed by societal norms.