3. On April 1, A.C. Corporation a calendar-year U.S. electronics manufacturer, buys 550000 Yen worth of computer chips from the Hidachi company paying 10 percent down, the balance to be paid in 3 months. Interest at 8 percent per annum is payable on the unpaid foreign currency balance. The U.S. dollars /Japanese Yen exchange rate on April 1 was $1.00= 104; on July 1 it was $1.00=106. What would be the translation gain or loss for this transaction?
3. On April 1, A.C. Corporation a calendar-year U.S. electronics manufacturer, buys 550000 Yen worth of computer chips from the Hidachi company paying 10 percent down, the balance to be paid in 3 months. Interest at 8 percent per annum is payable on the unpaid foreign currency balance. The U.S. dollars /Japanese Yen exchange rate on April 1 was $1.00= 104; on July 1 it was $1.00=106. What would be the translation gain or loss for this transaction?
Chapter9: Taxation Of International Transactions
Section: Chapter Questions
Problem 27P
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3.
On April 1, A.C. Corporation a calendar-year U.S. electronics manufacturer,
buys 550000 Yen worth of computer chips from the Hidachi company paying 10 percent down, the balance to be paid in 3 months. Interest at 8 percent per annum is payable on the unpaid foreign currency balance. The U.S. dollars /Japanese Yen exchange rate on April 1 was $1.00= 104; on July 1 it was $1.00=106.
What would be the translation gain or loss for this transaction?
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