(Answered) Q1 norton co a us corporation sold inventory on december 31

Accounting

Q1. Norton Co., a U.S. corporation, sold inventory on December 31, 2008, with payment of 10,000 British pounds to be received in sixty days. The pertinent exchange rates were as follows:

Dec 1 Spot rate $1.7241

Dec 31 Spot rate $1.8182

Jan 30 Spot rate $1.6666

What amount of foreign exchange gain or loss should be recorded on January 30?

a. $1,516 gain

b. $1,516 loss

c. $575 loss

d. $500 loss

Q2. Pigskin Co., a U.S. corporation, sold inventory on credit to a British company on April 8, 2008. Pigskin received payment of 35,000 pounds on May 8, 2008. The exchange rate was $1 = 0.65 on April 8 and $1 = 0.70 on May 8. What amount of foreign exchange gain or loss should be recognized? (round to the nearest dollar)

a. $10,500 loss

b. $10,500 gain

c. $1,750 loss

d. $3,846 loss

Q3. According to SFAS 52, which method is usually required for translating a foreign subsidiary's financial statements into the parent's reporting currency?

a. The temporal method

b. The current rate method

c. The current/non-current method

d. The monetary/non-monetary method

e. The non-current method

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