Financing and Exchange Rate Risk Compton Co. has a subsidiary in Thailand that produces computer components. The subsidiary sells the components to manufacturers in the United States. The components are invoiced in U.S. dollars. Compton pays employees of the subsidiary in Thai baht and makes a large monthly lease payment in Thai baht. The parent financed the investment in the Thai subsidiary by borrowing dollars from a U.S. bank. Compton has no other international business.
Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*
*Response times vary by subject and question complexity. Median response time is 34 minutes and may be longer for new subjects.