Questions from International Accounting

Q: In evaluating the performance of a foreign manager, a parent company

In evaluating the performance of a foreign manager, a parent company should never penalize a manager for things the manager cannot control. Given the information provided in Exercise 6, prepare a perf...

Q: To encourage its foreign managers to incorporate expected exchange rate changes into

To encourage its foreign managers to incorporate expected exchange rate changes into their operating decisions, Vancouver Enterprises requires that all foreign currency budgets be set in Canadian doll...

Q: Exhibit 10-9 contains a performance report that breaks out various

Exhibit 10-9 contains a performance report that breaks out various operating variances of a foreign affiliate, assuming the parent currency is the functional currency under FAS No. 52. Using the infor...

Q: Parent Company establishes three wholly owned affiliates in countries X, Y

Parent Company establishes three wholly owned affiliates in countries X, Y, and Z. Its total investment in each of the respective affiliates at the beginning of the year, together with year-end return...

Q: If you had a nontrivial sum of money to invest and decided

If you had a nontrivial sum of money to invest and decided to invest it in a country index fund, in which country or countries identified in Exhibit 1-7 would you invest your money? What accounting is...

Q: You have just landed a summer internship (congratulations) with the

You have just landed a summer internship (congratulations) with the management information services group of Pirelli, the Italian global tire manufacturer. Management is acutely aware of the importanc...

Q: The scene is a conference room on the 10th floor of an

The scene is a conference room on the 10th floor of an office building on Wall Street, occupied by Anthes Enterprises, a small, rapidly growing manufacturer of electronic trading systems for equities,...

Q: Compare and contrast the terms translation, transaction, and economic exposure

Compare and contrast the terms translation, transaction, and economic exposure. Does FAS No. 52 resolve the issue of accounting versus economic exposure?

Q: List 10 ways to reduce a firm’s foreign exchange exposure for a

List 10 ways to reduce a firm’s foreign exchange exposure for a foreign affiliate located in a devaluation-prone country. In each instance, identify the cost–benefit trade-offs that need to be measure...

Q: Explain, in your own words, the difference between a multicurrency

Explain, in your own words, the difference between a multicurrency translation exposure report and a multicurrency transactions exposure report.