Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN: 9781285595047
Author: Weil
Publisher: Cengage
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TT Exports (TTE)Manufacturing's foreign subsidiary has the following balance sheet:
Cash, marketable securities
Accounts receivable
Inventory (at market.
Fixed Assets
Total assets
FC 250,000
1,000,000
2,700,000
5,100,000
-----------------
FC 9,050,000
Current liabilities
Long-term debt
Equity
Total liabilities
plus equity
FC 750,000
3,400,000
4,900,000
---------------
FC 9,050,000
Suppose the FC appreciates from $0.70 to $0.75 during the period. Under the current rate method, what is TTEs translation gain (loss)?
a.
a loss of $192,000
b.
a loss of $12,000
c.
a gain of $294,000
d.
a gain of $245,000
Financial instruments are assets that have a monetary value or record a monetary transaction. To coordinate the exchange of capital between borrowers and lenders, financial instruments trade in the financial markets. These financial instruments can be categorized on the basis of their issuers, maturity, risk, and other factors.
Identify the financial instruments based on the following descriptions.
Backed by the U.S. government, these financial instruments are short-term debt obligations with a maturity of less than one year. They are considered risk-free investments.
State and local government bonds, U.S. Tresury, U.S. Tresury notes and bonds
Issued by money-centered financial firms, these short- or medium-term insured debt instruments pay higher interest than a regular savings account. They are low-risk instruments and have low returns.
Money Market Mutual Funds, Certificates of Deposit, Commercial Paper
These financial instruments are investment pools that buy such…
Which of the following is a matured money market instrument widely used in the USA, Europe and Asia where both cash and securities are the motivators?
a.
Commercial Papers
b.
Treasury Bills
c.
Repurchase Agreements
d.
Certificate of Deposits
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