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boland boland
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A Canadian subsidiary of a U.S. parent firm is instructed to bill an export to the parent in U.S. dollars. The Canadian subsidiary records the accounts receivable in Canadian dollars and notes a profit on the sale of goods. Later, when the U.S. parent pays the subsidiary the contracted U.S. dollar amount, the Canadian dollar has appreciated 10% against the U.S. dollar. In this example, the Canadian subsidiary will record a
A) any gain or loss will be recorded only by the parent firm.
B) since the Canadian firm is a U.S. subsidiary neither a gain nor loss will be recorded.
C) 10% foreign exchange gain on the U.S. dollar accounts receivable.
D) 10% foreign exchange loss on the U.S. dollar accounts receivable.
Textbook 
Fundamentals of Multinational Finance

Fundamentals of Multinational Finance


Edition: 5th
Authors:
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noxx53noxx53
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boland Author
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Upwards Arrow Perfection
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You're welcome Wink Face
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