Subsidiary a of Mega Corporation Has Net Inflows in Australian

question 27

Multiple Choice

Subsidiary A of Mega Corporation has net inflows in Australian dollars of A$1,000,000, while Subsidiary B has net outflows in Australian dollars of A$1,500,000. The expected exchange rate of the Australian dollar is $.55. What is the net inflow or outflow as measured in U.S. dollars?

• A)$500,000 outflow.
• B)$500,000 inflow.
• C)$275,000 inflow.
• D)$275,000 outflow.

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Definitions:

Comparability

The quality that allows users to analyze and recognize similarities and differences between two or more items of financial information.

Operational Results

The financial outcomes resulting from a company's core business operations.

Income Tax Expense

The amount of money a company is required to pay to the government based on its taxable income.