48-Orange Incorporation is a US-based MNC that conducts a part of its business in Oman. The transactions are denominated in Omani rials. The following details are extracted from the book of Orange incorporation in Oman. Sales RO 150,000, Cost of goods sold RO 45,000, Operating expenses RO 24,000, Depreciation expenses RO 10,000. The historical exchange rate = OMR 2/USD, The average exchange rate = OMR 3/USD, The spot exchange rate = OMR 1.5/USD. Translate the above details into reporting currency by using the monetary and non-monetary method and find the translated net profit/loss from the following options. O a. Converted net profit is USD 14,500 O b. Converted net loss is USD 12,500 O c. None of the options O d. Converted net loss is USD 14,500
48-Orange Incorporation is a US-based MNC that conducts a part of its business in Oman. The transactions are denominated in Omani rials. The following details are extracted from the book of Orange incorporation in Oman. Sales RO 150,000, Cost of goods sold RO 45,000, Operating expenses RO 24,000, Depreciation expenses RO 10,000. The historical exchange rate = OMR 2/USD, The average exchange rate = OMR 3/USD, The spot exchange rate = OMR 1.5/USD. Translate the above details into reporting currency by using the monetary and non-monetary method and find the translated net profit/loss from the following options. O a. Converted net profit is USD 14,500 O b. Converted net loss is USD 12,500 O c. None of the options O d. Converted net loss is USD 14,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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48-Orange Incorporation is a US-based MNC that conducts a part of its business in Oman. The transactions are denominated in Omani rials. The following details are extracted from the book of Orange incorporation in Oman. Sales RO 150,000, Cost of goods sold RO 45,000, Operating expenses RO 24,000, Depreciation expenses RO 10,000. The historical exchange rate = OMR 2/USD, The average exchange rate = OMR 3/USD, The spot exchange rate = OMR 1.5/USD. Translate the above details into reporting currency by using the monetary and non-monetary method and find the translated net profit/loss from the following options.
O a. Converted net profit is USD 14,500
O b. Converted net loss is USD 12,500
O c. None of the options
O d. Converted net loss is USD 14,500
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