McCarthy, Inc.’s Brazilian subsidiary borrowed 100,000 euros on January 1, 2017. Exchange rates between the Brazilian real (BRL) and euro (€) and between the U.S. dollar ($) and BRL are as follows: BRL (per euro€) US $ Per BRL January 1, 2017 BRL 4.2 $0.28 Average, 2017 BRL 4.3 $0.25 December 31, 2017 BRL 4.6 $0.20 At what amount should the Brazilian subsidiary’s euro note payable be reported on McCarthy’s December 31, 2017, consolidated balance sheet? Choose the correct.a. $84,000.b. $86,000.c. $92,000.d. $128,800.

McCarthy, Inc.’s Brazilian subsidiary borrowed 100,000 euros on January 1, 2017. Exchange rates between the Brazilian real (BRL) and euro (€) and between the U.S. dollar ($) and BRL are as follows: BRL (per euro€) US $ Per BRL January 1, 2017 BRL 4.2 $0.28 Average, 2017 BRL 4.3 $0.25 December 31, 2017 BRL 4.6 $0.20 At what amount should the Brazilian subsidiary’s euro note payable be reported on McCarthy’s December 31, 2017, consolidated balance sheet? Choose the correct.a. $84,000.b. $86,000.c. $92,000.d. $128,800.

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter13: Marketable Securities And Derivatives

Section: Chapter Questions

Problem 22E

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McCarthy, Inc.’s Brazilian subsidiary borrowed 100,000 euros on January 1, 2017. Exchange rates between the Brazilian real (BRL) and euro (€) and between the U.S. dollar ($) and BRL are as follows: BRL (per euro€) US $ Per BRL January 1, 2017 BRL 4.2 $0.28 Average, 2017 BRL 4.3 $0.25 December 31, 2017 BRL 4.6 $0.20 What amount of foreign exchange gain or loss should be reflected in McCarthy’s 2017 consolidated net income?a. $8,000 loss.b. $10,000 loss.c. $2,000 gain.d. $5,000 gain.
McCarthy, Incorporated's Brazilian subsidiary borrowed 125,000 euros on January 1, 2024, Exchange rates between the Brazilian real (BRL) and euro (€) and between the U.S. dollar ($) and BRL are as follows: January 1, 2024 Average, 2024 December 31, 2024 Required: BRL per € BRL 4.20 US$ per BRL $ 0.28 BRL 4.30 $ 0.25 BRL 4.60 $ 0.20 a. Determine the amount at which the Brazilian subsidiary's euro note payable should be reported on McCarthy's December 31, 2024, consolidated balance sheet? b. Determine the amount of foreign exchange gain or loss that should be reflected in McCarthy's 2024 consolidated net income. a. Note Payable b. Foreign Exchange
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On December 20, 2017, Butanta Company (a U.S. company headquartered in Miami, Florida) sold parts to a foreign customer at a price of 50,000 ostras. Payment is received on January 10, 2018. Currency exchange rates for 1 ostra are as follows: December 20, 2017 $1.05December 31, 2017 1.02January 10, 2018 0.98a. How does the fluctuation in exchange rates affect Butanta’s 2017 income statement?b. How does the fluctuation in exchange rates affect Butanta’s 2018 income statement?
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Problems 20 and 21 are based on the following information.McCarthy, Inc.’s Brazilian subsidiary borrowed 100,000 euros on January 1, 2017. Exchange rates between the Brazilian real (BRL) and euro (€) and between the U.S. dollar ($) and BRL are as follows:At what amount should the Brazilian subsidiary’s euro note payable be reported on McCarthy’s December 31, 2017, consolidated balance sheet?a. $84,000.b. $86,000.c. $92,000.d. $128,800.
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Problems 20 and 21 are based on the following information.McCarthy, Inc.’s Brazilian subsidiary borrowed 100,000 euros on January 1, 2017. Exchange rates between the Brazilian real (BRL) and euro (€) and between the U.S. dollar ($) and BRL are as follows:What amount of foreign exchange gain or loss should be reflected in McCarthy’s 2017 consolidated net income?a. $8,000 loss.b. $10,000 loss.c. $2,000 gain.d. $5,000 gain.