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| 1 | |
Globalization typically progresses through a series of stages that include which of the following? |
| | A) | Exporting |
| | B) | Wholly owned subsidiaries |
| | C) | Global sourcing |
| | D) | All of the above |
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| 2 | |
Which of the following is a contractual agreement between a company and a foreign party allowing the use of trademarks, patents, technology, designs, processes, intellectual property, or other proprietary advantage? |
| | A) | Hedging |
| | B) | Futures contract |
| | C) | International licensing |
| | D) | Regional value content |
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| 3 | |
The international environmental forces that affect the accounting information measured, reported, and created include which of the following? |
| | A) | Political and legal systems |
| | B) | Culture |
| | C) | Technology and infrastructure |
| | D) | All of the above |
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| 4 | |
In which country would you expect to find a high degree of power distance culture? |
| | A) | United States |
| | B) | South Korea |
| | C) | Germany |
| | D) | Sweden |
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| 5 | |
Which of the following applies to a market economy? |
| | A) | The government uses central planning to allocate resources. |
| | B) | The ownership of land and the means of production are private. |
| | C) | It is used extensively in China. |
| | D) | None of the above applies to a market economy. |
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| 6 | |
Which of the following is charged with the responsibility of establishing and gaining acceptance of international accounting standards? |
| | A) | Foreign Trade Standards Committee |
| | B) | International Auditing Standards Committee |
| | C) | International Accounting Standards Board |
| | D) | Foreign Accounting Standards Committee |
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| 7 | |
The statement “A strong dollar rose sharply against the weakening British pound, but fell slightly against the Japanese yen and Swiss franc"' means that in terms of the U.S. dollar, which of the following occurred? |
| | A) | British pound fell sharply |
| | B) | Japanese yen rose sharply |
| | C) | Swiss franc fell slightly |
| | D) | Both (A) and (C) occurred |
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| 8 | |
A U.S. company recorded the purchase of inventory from a British company at a price of 10,000 British pounds, when the exchange rate per British pound was $1.44. The account payable was paid within the same accounting period, but the exchange rate had increased to $1.54. At the time of payment the company will recognize which of the following? |
| | A) | A gain on fluctuations in foreign exchange rates |
| | B) | A loss on fluctuations in foreign exchange rates |
| | C) | No gain or loss in foreign exchange rate fluctuations |
| | D) | A debit to Accounts Payable for $15,400 |
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| 9 | |
A U.S. company sold merchandise to a British company at a price of 10,000 pounds when the exchange rate was $1.61 per British pound. The receivable was collected within the same accounting period, but the exchange rate had increased to $1.72. At the time of collection, a U.S. company would recognize which of the following? |
| | A) | Loss on Fluctuations in Foreign Exchange Rates |
| | B) | No gain or loss in foreign exchange rate fluctuations |
| | C) | Credit to Accounts Receivable for $16,100 |
| | D) | Both (A) and (C). |
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| 10 | |
There are two basic approaches to avoiding losses from fluctuations in foreign exchange rates. The approaches include which of the following? |
| | A) | Hedging |
| | B) | Buying or selling futures |
| | C) | Ignoring the exchange rates, stating everything in U.S. dollars |
| | D) | Both (A) and (C). |
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