accounting exam 3 ch 18,19,20

Neubart Company owns 100% of the outstanding shares of two European subsidiaries, which operate largely independently and operate in a different industry than Neubart. The subsidiaries' earnings typically are reinvested in their home country. In consolidating the subsidiaries financial statements with those of the U.S. parent, the subsidiaries' financial statement numbers should be:
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Neubart Company owns 100% of the outstanding shares of two European subsidiaries, which operate largely independently and operate in a different industry than Neubart. The subsidiaries' earnings typically are reinvested in their home country. In consolidating the subsidiaries financial statements with those of the U.S. parent, the subsidiaries' financial statement numbers should be:
translated using the current rate method.
Porter Company, a U.S. GAAP reporting company is trying to determine the functional currency of one of its subsidiaries. After considering authoritative guidelines, the results still are mixed. Porter Company should choose the functional currency:
based on management judgement
the following type of us company is most likely to include in its consolidated financial statements subsidiaries with non us functional currencies
a conglomerate with foreign investments in may different industries
assets and liabilities of a foreign subsidiary that are not evaluated in response to exchange rate changes, are reported in the us based consolidated financial statements at
historical exchange rates
Bremmer Company's functional currency is the Euro. On February 1, 20X1, when the exchange rate is $1.20 per Euro, Bremmer purchases 100 units of inventory for a total purchase price of 4,300 Euros. Bremmer sells half of the inventory on March 24 and the other half on April 14. The exchange rate is $1.17 on March 24 and $1.21 on April 14.

Bremmer's U.S. based parent company should convert Bremmer's financial statement amount to U.S dollars using the:
current rate mathod
Bremmer Company's functional currency is the Euro. On February 1, 20X1, when the exchange rate is $1.20 per Euro, Bremmer purchases 100 units of inventory for a total purchase price of 4,300 Euros. Bremmer sells half of the inventory on March 24 and the other half on April 14. The exchange rate is $1.17 on March 24 and $1.21 on April 14.

If Bremmer were to keep records denominated in U.S. dollars, the company would recognize the sale of inventory April 14, by crediting cost of goods sold for:
2,601,50
which of the following is not an indication that a foreign subsidiary function currency is that of the parents company?
the subsidiary's cash flows primarily originate in the subsidiaries country and currency
Meadows Limited, a foreign subsidiary of U.S. based Meadows Inc. operates primarily for the benefit of its parent company. When the exchange rate was $1.30 per one British Pound Sterling (£), Meadows Limited purchased Inventory for £2,100 pounds. Meadows resells one- third of the inventory for £900 when the exchange rate was $1.26 per Pound Sterling and another one-third for £900 when the exchange rate was $1.28 per Pound Sterling. The parent company applies the temporal method in its process of consolidating the financial results of its subsidiaries with its own financial results.

Meadows Inc. reports cost of goods associated with its subsidiary in the amount of:
(£2,100/3 × 2) × 1.30 = $1,820
Wiese Limited, a foreign subsidiary of U.S. based Wald Inc. operates primarily economically independent from its parent company. When the exchange rate was $1.30 per one British Pound Sterling (£), Wald Limited purchased Inventory for £2,100 pounds. Wald resells one-third of the inventory for £900 when the exchange rate was $1.26 per Pound Sterling and another one-third for £900 when the exchange rate was $1.28 per Pound Sterling. At the end of the reporting period, the exchange rate is $1.29 per Pound Sterling. The parent company applies the current rate method in its process of consolidating the financial results of its subsidiaries with its own financial results.

Wald Inc. reports sales revenue associated with its subsidiary in the amount of:
(£900 × 1.26) + (£900 × 1.28) = $2,286
Meadows Limited, a foreign subsidiary of U.S. based Meadows Inc. operates primarily for the benefit of its parent company. When the exchange rate was $1.30 per one British Pound Sterling (£), Meadows Limited purchased Inventory for £2,100 pounds. Meadows resells one- third of the inventory for £900 when the exchange rate was $1.26 per Pound Sterling and another one-third for £900 when the exchange rate was $1.28 per Pound Sterling. The parent company applies the temporal method in its process of consolidating the financial results of its subsidiaries with its own financial results.

Meadows Inc. reports ending inventory associated with its subsidiary in the amount of:
(£700 × 1.3) = $910