For Each of the Following Situations,select the Best Answer Concerning

question 47

Essay

For each of the following situations,select the best answer concerning accounting for foreign currency transactions:
(A)Results in a foreign exchange gain.
(B)Results in a foreign exchange loss.
(C)No foreign exchange gain or loss.
_____1.Export sale by a U.S.company denominated in dollars,foreign currency of buyer appreciates.
_____2.Export sale by a U.S.company denominated in foreign currency,foreign currency of buyer appreciates.
_____3.Import purchase by a U.S.company denominated in foreign currency,foreign currency of buyer appreciates.
_____4.Import purchase by a U.S.company denominated in dollars,foreign currency of buyer appreciates.
_____5.Import purchase by a U.S.company denominated in foreign currency,foreign currency of buyer depreciates.
_____6.Import purchase by a U.S.company denominated in dollars,foreign currency of buyer depreciates.
_____7.Export sale by a U.S.company denominated in dollars,foreign currency of buyer depreciates.
_____8.Export sale by a U.S.company denominated in foreign currency,foreign currency of buyer depreciates.

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Definitions:

Tax Rate

The percentage at which an individual or corporation is taxed by the government.

After-Tax Cost

The actual cost of an expense or investment to a company or individual after accounting for the effects of taxes.

WACC

The Weighted Average Cost of Capital (WACC) refers to the average rate of return a company is expected to pay to its security holders to finance its assets.

Debt Ratio

The debt ratio is a financial metric that measures the extent of a company’s leverage, calculated by dividing total liabilities by total assets.