Question 1

_____ is the technique financial managers use to try to quantify the benefits, costs, and risks of an investment.

Accepted Answer

A)  Capital budgeting 
B)  External audit 
C)  Transfer pricing 
D)  Control system analysis 
A)  Capital budgeting 
B)  External audit 
C)  Transfer pricing 
D)  Control system analysis

Question 2

Which of the following was formed in March 2001 to replace the International Accounting Standards Committee (IASC)?

Accepted Answer

A)  U.S. Securities and Exchange Commission 
B)  International Accounting Standards Board 
C)  Office of Economic Analysis 
D)  Financial Accounting Standards Board 
A)  U.S. Securities and Exchange Commission 
B)  International Accounting Standards Board 
C)  Office of Economic Analysis 
D)  Financial Accounting Standards Board

Question 3

Historically, financial reports prepared by firms in Germany:

Accepted Answer

A)  reveal less information than reports of British or U.S. firms. 
B)  contain detailed information required by individual investors. 
C)  overvalued assets and undervalued liabilities. 
D)  made more public disclosures compared to firms in other countries. 
A)  reveal less information than reports of British or U.S. firms. 
B)  contain detailed information required by individual investors. 
C)  overvalued assets and undervalued liabilities. 
D)  made more public disclosures compared to firms in other countries.

Question 4

A _____ specifies that parent companies are not taxed on foreign source income until they actually receive a dividend.

Accepted Answer

A)  bilateral agreement 
B)  tax credit 
C)  deferral principle 
D)  tax treaty 
A)  bilateral agreement 
B)  tax credit 
C)  deferral principle 
D)  tax treaty

Question 5

Money management decisions attempt to manage a firm's _____.

Accepted Answer

A)  equity capital 
B)  fixed costs 
C)  working capital 
D)  equipment costs 
A)  equity capital 
B)  fixed costs 
C)  working capital 
D)  equipment costs

Question 6

The problem of blocked earnings is not as serious now as it once was because:

Accepted Answer

A)  fixed exchange rates have become more common now. 
B)  governmental intervention in earnings is more frequent now. 
C)  there is greater acceptance of free market economics now. 
D)  political risk within the economy is very low in modern times. 
A)  fixed exchange rates have become more common now. 
B)  governmental intervention in earnings is more frequent now. 
C)  there is greater acceptance of free market economics now. 
D)  political risk within the economy is very low in modern times.

Question 7

Transfer price refers to the:

Accepted Answer

A)  price at which goods and services are transferred to a subsidiary. 
B)  price at which the title of products is transferred to a customer. 
C)  price at which a supplier provides raw materials to a firm. 
D)  cost incurred when goods or services are transferred from one place to another. 
A)  price at which goods and services are transferred to a subsidiary. 
B)  price at which the title of products is transferred to a customer. 
C)  price at which a supplier provides raw materials to a firm. 
D)  cost incurred when goods or services are transferred from one place to another.

Question 8

A(n) _____ is a loan between a parent and its subsidiary channeled through a financial intermediary, usually a large international bank.

Accepted Answer

A)  fronting loan 
B)  equity loan 
C)  direct loan 
D)  security loan 
A)  fronting loan 
B)  equity loan 
C)  direct loan 
D)  security loan

Question 9

Lessard and Lorange recommend that firms use the projected spot exchange rate to translate both the budget and performance figures into the corporate currency.

Accepted Answer

A) True 
 B)False

Question 10

By pooling cash resources centrally firms can:

Accepted Answer

A)  better handle short-term cash needs of subsidiaries. 
B)  increase liquidity of independent subsidiaries. 
C)  reduce the total size of the cash pool it must hold. 
D)  avoid government-imposed restrictions on capital flows. 
A)  better handle short-term cash needs of subsidiaries. 
B)  increase liquidity of independent subsidiaries. 
C)  reduce the total size of the cash pool it must hold. 
D)  avoid government-imposed restrictions on capital flows.

Question 11

A German firm raising capital by selling stock through the London Stock Exchange is an example of _____.

Accepted Answer

A)  transnational financing 
B)  service exporting 
C)  indirect financing 
D)  transnational investment 
A)  transnational financing 
B)  service exporting 
C)  indirect financing 
D)  transnational investment

Question 12

Lessard and Lorange refer company-generated forecast of future spot rates as _____ rate.

Accepted Answer

A)  forward exchange 
B)  internal forward 
C)  initial exchange 
D)  ending exchange 
A)  forward exchange 
B)  internal forward 
C)  initial exchange 
D)  ending exchange

Question 13

Most international businesses require all budgets and performance data within the firm to be expressed in the "corporate currency," which is normally:

Accepted Answer

A)  a common currency such as the U.S. dollar. 
B)  the home currency. 
C)  a foreign currency. 
D)  the currency of the country where products are sold. 
A)  a common currency such as the U.S. dollar. 
B)  the home currency. 
C)  a foreign currency. 
D)  the currency of the country where products are sold.

Question 14

Accounting standards:

Accepted Answer

A)  are rules for preparing financial statements. 
B)  define the levels of tax-payments needed. 
C)  specify the rules for performing an audit. 
D)  refer to the technical process of balancing accounts. 
A)  are rules for preparing financial statements. 
B)  define the levels of tax-payments needed. 
C)  specify the rules for performing an audit. 
D)  refer to the technical process of balancing accounts.

Question 15

What are the considerations when seeking external financing for international business?

Accepted Answer

If external financing is required, the f

Question 16

A firm's ability to establish a centralized depository that can serve short-term cash needs might be limited by government-imposed restrictions on capital flows across borders.

Accepted Answer

A) True 
 B)False

Question 17

The _____ has 15 members who are responsible for the formulation of new international financial reporting standards.

Accepted Answer

A)  U.S. Securities and Exchange Commission 
B)  International Accounting Standards Board 
C)  Office of Economic Analysis 
D)  Financial Accounting Standards Board 
A)  U.S. Securities and Exchange Commission 
B)  International Accounting Standards Board 
C)  Office of Economic Analysis 
D)  Financial Accounting Standards Board

Question 18

Pooling the cash of all the subsidiaries:

Accepted Answer

A)  lowers the interest rate earned. 
B)  reduces the earning potential for firms. 
C)  increases the interest rate paid. 
D)  increases the earning potential for firms. 
A)  lowers the interest rate earned. 
B)  reduces the earning potential for firms. 
C)  increases the interest rate paid. 
D)  increases the earning potential for firms.

Question 19

According to Lessard-Lorange model, _____ is the spot exchange rate forecast for the end of the budget period.

Accepted Answer

A)  projected 
B)  initial 
C)  ideal 
D)  ending 
A)  projected 
B)  initial 
C)  ideal 
D)  ending

Question 20

Accounting is shaped by the environment in which it operates.

Accepted Answer

A) True 
 B)False

_____ is the technique financial managers use to try to quantify the benefits, costs, and risks of an investment.

Which of the following was formed in March 2001 to replace the International Accounting Standards Committee (IASC)?

Historically, financial reports prepared by firms in Germany:

A _____ specifies that parent companies are not taxed on foreign source income until they actually receive a dividend.

Money management decisions attempt to manage a firm's _____.

The problem of blocked earnings is not as serious now as it once was because:

Transfer price refers to the:

A(n) _____ is a loan between a parent and its subsidiary channeled through a financial intermediary, usually a large international bank.

Lessard and Lorange recommend that firms use the projected spot exchange rate to translate both the budget and performance figures into the corporate currency.

By pooling cash resources centrally firms can:

A German firm raising capital by selling stock through the London Stock Exchange is an example of _____.

Lessard and Lorange refer company-generated forecast of future spot rates as _____ rate.

Most international businesses require all budgets and performance data within the firm to be expressed in the "corporate currency," which is normally:

Accounting standards:

What are the considerations when seeking external financing for international business?

A firm's ability to establish a centralized depository that can serve short-term cash needs might be limited by government-imposed restrictions on capital flows across borders.

The _____ has 15 members who are responsible for the formulation of new international financial reporting standards.

Pooling the cash of all the subsidiaries:

According to Lessard-Lorange model, _____ is the spot exchange rate forecast for the end of the budget period.

Accounting is shaped by the environment in which it operates.

Globalization

National Differences in Political Economy, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Government Policy and International Trade

Foreign Direct Investment

Regional Trade Pacts Give the Mexican Auto Industry an Edge

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and RD

Global Human Resource Management

Filters

Exam 20: Accounting and Finance in the International Business

_____ is the technique financial managers use to try to quantify the benefits, costs, and risks of an investment.

Which of the following was formed in March 2001 to replace the International Accounting Standards Committee (IASC)?

Historically, financial reports prepared by firms in Germany:

A _____ specifies that parent companies are not taxed on foreign source income until they actually receive a dividend.

Money management decisions attempt to manage a firm's _____.

The problem of blocked earnings is not as serious now as it once was because:

Transfer price refers to the:

A(n) _____ is a loan between a parent and its subsidiary channeled through a financial intermediary, usually a large international bank.

Lessard and Lorange recommend that firms use the projected spot exchange rate to translate both the budget and performance figures into the corporate currency.

By pooling cash resources centrally firms can:

A German firm raising capital by selling stock through the London Stock Exchange is an example of _____.

Lessard and Lorange refer company-generated forecast of future spot rates as _____ rate.

Most international businesses require all budgets and performance data within the firm to be expressed in the "corporate currency," which is normally:

Accounting standards:

What are the considerations when seeking external financing for international business?

A firm's ability to establish a centralized depository that can serve short-term cash needs might be limited by government-imposed restrictions on capital flows across borders.

The _____ has 15 members who are responsible for the formulation of new international financial reporting standards.

Pooling the cash of all the subsidiaries:

According to Lessard-Lorange model, _____ is the spot exchange rate forecast for the end of the budget period.

Accounting is shaped by the environment in which it operates.

Globalization

National Differences in Political Economy, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Government Policy and International Trade

Foreign Direct Investment

Regional Trade Pacts Give the Mexican Auto Industry an Edge

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and RD

Global Human Resource Management

Filters