The Simpson Corporation is calculating their adjusted balance sheet into U.S. Dollars. The exchange rate at the beginning of the year was $1 Euro = $1 U.S. dollar. The current exchange rate is .80 Euros to $1.00. Net Income for the year was zero. How much is the accounting gain/loss due to the exchange rate change? Beginning Balance Sheet: Assets = 3,000 Euros Equity = 1,500 Euros Liabilities = 1,500 Euros Multiple Choice $375, loss $375, gain $500, loss $125, gain $500, gain
The Simpson Corporation is calculating their adjusted balance sheet into U.S. Dollars. The exchange rate at the beginning of the year was $1 Euro = $1 U.S. dollar. The current exchange rate is .80 Euros to $1.00. Net Income for the year was zero. How much is the accounting gain/loss due to the exchange rate change? Beginning Balance Sheet: Assets = 3,000 Euros Equity = 1,500 Euros Liabilities = 1,500 Euros Multiple Choice $375, loss $375, gain $500, loss $125, gain $500, gain
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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The Simpson Corporation is calculating their adjusted balance sheet into U.S. Dollars. The exchange rate at the beginning of the year was $1 Euro = $1 U.S. dollar. The current exchange rate is .80 Euros to $1.00. Net Income for the year was zero. How much is the accounting gain/loss due to the exchange rate change?
Beginning Balance Sheet:
- Assets = 3,000 Euros
- Equity = 1,500 Euros
- Liabilities = 1,500 Euros
Multiple Choice
-
$375, loss
-
$375, gain
-
$500, loss
-
$125, gain
-
$500, gain
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