Translate the balance sheet into US dollars by using the current rate method and temporal method.
Translate the balance sheet into US dollars by using the current rate method and temporal method.
Chapter9: Taxation Of International Transactions
Section: Chapter Questions
Problem 28P
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Example 2: Pepsi Refreshment Company is Omani affiliate of US Refreshment Company. Its balance sheet at year end is shown below:
Balance Sheet
Assets |
Amounts in OMR |
Liabilities |
Amounts in OMR |
Cash |
10000 |
Accounts payable |
6000 |
Accounts receivables |
22000 |
Long-term debts |
16000 |
Inventory |
32000 |
Capital Stock |
62000 |
Plant and Equipment |
20000 |
|
|
Total |
84000 |
Total |
84000 |
The current exchange rate is USD 2.5900/OMR
The historical exchange rate is USD 2.6074/OMR
Requirement: Translate the balance sheet into US dollars by using the current rate method and temporal method.
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