Cost of goods sold.... Beginning inventory . Ending inventory.. LCU 5,000,000 500,000 600,000
Cost of goods sold.... Beginning inventory . Ending inventory.. LCU 5,000,000 500,000 600,000
Chapter10: Inventory
Section: Chapter Questions
Problem 11PA: Calculate a) cost of goods sold, b) ending inventory, and c) gross margin for A76 Company,...
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A U.S. company’s foreign subsidiary had these amounts in local currency units (LCU) in 2017:
The average exchange rate during 2017 was $1.00 = LCU 1. The beginning inventory was acquired when the exchange rate was $0.80 = LCU 1. Ending inventory was acquired when the exchange rate was $1.10 = LCU 1. The exchange rate at December 31, 2017, was $1.15 = LCU 1. Assuming that the foreign country is highly inflationary, at what amount should the foreign subsidiary’s cost of goods sold be reflected in the U.S. dollar income statement?
a. $4,440,000.
b. $4,840,000.
c. $5,000,000.
d. $5,750,000.
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