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International Accounting, 5e Timothy Doupnik,Hector Perera
(Test Bank all Chapters)
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1 Copyright 2020 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.International Accounting, 5e (Doupnik) Chapter 1 Introduction to International Accounting
1) Which of the following groups is a supranational organization?
- International Accounting Standards Board
- Organization for Economic Cooperation and Development
- International Federation of Accountants
- All of the above
Answer: D
Difficulty: 1 Easy
Topic: Global Accounting Standards
Learning Objective: 01-01 Discuss the nature and scope of international accounting.
Bloom's: Remember
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
2) Determination of net present value involves:
- forecasting future profits and cash flows.
- discounting future cash flows back to their present value.
- analysis on an after-tax basis.
- All of the above
Answer: D
Difficulty: 2 Medium
Topic: Foreign Direct Investment
Learning Objective: 01-01 Discuss the nature and scope of international accounting.
Bloom's: Understand
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
3) In which of the following levels can international accounting be defined?
- Supranational organizations
- Company
- Country
- All of the above
Answer: D
Difficulty: 1 Easy
Topic: Global Accounting Standards
Learning Objective: 01-01 Discuss the nature and scope of international accounting.
Bloom's: Remember
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
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2 Copyright 2020 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.4) Which of the following functional areas is included in the study of international accounting?
- Financial accounting
- Managerial
- Taxation
- All of the above
Answer: D
Difficulty: 1 Easy
Topic: Global Accounting Standards
Learning Objective: 01-01 Discuss the nature and scope of international accounting.
Bloom's: Remember
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
5) The factor used to convert from one country's currency to another country's currency is called
the:
- interest rate.
- cost of capital.
- exchange rate.
- strike price.
Answer: C
Difficulty: 1 Easy
Topic: Financial Reporting for Foreign Operations
Learning Objective: 01-02 Describe accounting issues confronted by companies involved in international trade (import and export transactions).
Bloom's: Understand
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
6) What is the term used to describe the possibility that a foreign currency will decrease in U.S.dollar value over the life of an asset such as Accounts Receivable?
- Foreign exchange translation
- Foreign exchange risk
- Hedging
- Foreign currency options
Answer: B
Difficulty: 2 Medium
Topic: Sales to Customers
Learning Objective: 01-02 Describe accounting issues confronted by companies involved in international trade (import and export transactions).
Bloom's: Understand
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
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3 Copyright 2020 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
7) Foreign exchange risk arises when:
- business transactions are denominated in foreign currencies.
- sales are made to customers in a domestic country.
- goods or services purchased from suppliers in a foreign country are denominated in domestic
- auditing reports are prepared in a foreign currency.
currency.
Answer: A
Difficulty: 2 Medium
Topic: Sales to Customers
Learning Objective: 01-02 Describe accounting issues confronted by companies involved in international trade (import and export transactions).
Bloom's: Understand
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
8) In international accounting, a "hedge" is:
- a business transaction made to reduce the exposure of foreign exchange risk.
- the legal barriers in various divisions of a multinational company.
- the loss in US dollar resulting from a decline in the value of the US dollar relative to foreign
- a form of foreign direct investment.
currencies.
Answer: A
Difficulty: 2 Medium
Topic: Sales to Customers
Learning Objective: 01-02 Describe accounting issues confronted by companies involved in international trade (import and export transactions).
Bloom's: Understand
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
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