Question 1

Briefly differentiate accounting standards and auditing standards.

Accepted Answer

Accounting standards are rules for prepa

Question 2

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 3

What is capital budgeting?

Accepted Answer

Capital budgeting is the technique finan

Question 4

Describe the structure of the International Accounting Standards Board (IASB).

Accepted Answer

The International Accounting Standards B

Question 5

The governments of some countries require or prefer foreign multinationals to finance projects in their country by local debt financing or local sales of equity.

Accepted Answer

A) True 
 B)False

Question 6

_____ is the most common method by which firms transfer funds from foreign subsidiaries to the parent company.

Accepted Answer

A)  Issue of long-term loans 
B)  Payment of annual fee 
C)  Issue of bonds 
D)  Payment of dividends 
A)  Issue of long-term loans 
B)  Payment of annual fee 
C)  Issue of bonds 
D)  Payment of dividends

Question 7

A fronting loan is a loan between a parent and its subsidiary channeled through a financial intermediary.

Accepted Answer

A) True 
 B)False

Question 8

Explain the concept of transfer pricing.

Accepted Answer

The volume of intra-firm transactions in

Question 9

The projected rate will typically be the forward exchange rate as determined by the foreign exchange market when 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

What are the nine possible combinations of the three exchange rates proposed by Lessard and Lorange in the control process?

Accepted Answer

These three exchange rates imply nine po

Question 11

Which of the following combinations of exchange rates was ruled out by Lessard and Lorange as illogical and unreasonable?

Accepted Answer

A)  Translating budget using ending rate and translating actual performance using initial rate 
B)  Translating both actual performance and budget using projected rate 
C)  Translating both actual performance and budget using initial rate 
D)  Translating budget using projected rate and translating actual performance using ending rate 
A)  Translating budget using ending rate and translating actual performance using initial rate 
B)  Translating both actual performance and budget using projected rate 
C)  Translating both actual performance and budget using initial rate 
D)  Translating budget using projected rate and translating actual performance using ending rate

Question 12

A _____ represents the remuneration paid to the owners of technology, patents, or trade names for the use of that technology or the right to manufacture and/or sell products under those patents or trade names.

Accepted Answer

A)  fronting loan 
B)  fee 
C)  royalty 
D)  transfer price 
A)  fronting loan 
B)  fee 
C)  royalty 
D)  transfer price

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

Which of the following statements is true of tax havens?

Accepted Answer

A)  Firms that export to tax havens get special tax concessions from home governments. 
B)  Firms would require huge capital investments to start business in tax havens. 
C)  Nations such as United States are widely regarded as tax havens. 
D)  Firms can save tax by establishing a non-operating subsidiary in the tax haven. 
A)  Firms that export to tax havens get special tax concessions from home governments. 
B)  Firms would require huge capital investments to start business in tax havens. 
C)  Nations such as United States are widely regarded as tax havens. 
D)  Firms can save tax by establishing a non-operating subsidiary in the tax haven.

Question 15

The standards of U.S. Financial Accounting Standards Board and IASB are vastly different.

Accepted Answer

A) True 
 B)False

Question 16

In countries such as the United States and Britain, firms typically raised capital by _____.

Accepted Answer

A)  obtaining funding from the government 
B)  borrowing money from national banks 
C)  issuing stock or bonds to investors 
D)  borrowing money from international banks 
A)  obtaining funding from the government 
B)  borrowing money from national banks 
C)  issuing stock or bonds to investors 
D)  borrowing money from international banks

Question 17

Using the ending rate to translate the budget is a valid practice according to the Lessard-Lorange Model.

Accepted Answer

A) True 
 B)False

Question 18

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 19

Every time a firm changes cash from one currency into another currency it must bear a transaction cost.

Accepted Answer

A) True 
 B)False

Question 20

The connection between cash flows to the parent and the source of financing must be recognized when performing capital budgeting for an international business.

Accepted Answer

A) True 
 B)False

Briefly differentiate accounting standards and auditing standards.

Accounting standards _____.

What is capital budgeting?

Describe the structure of the International Accounting Standards Board (IASB).

The governments of some countries require or prefer foreign multinationals to finance projects in their country by local debt financing or local sales of equity.

_____ is the most common method by which firms transfer funds from foreign subsidiaries to the parent company.

A fronting loan is a loan between a parent and its subsidiary channeled through a financial intermediary.

Explain the concept of transfer pricing.

The projected rate will typically be the forward exchange rate as determined by the foreign exchange market when firms use the projected spot exchange rate to translate both the budget and performance figures into the corporate currency.

What are the nine possible combinations of the three exchange rates proposed by Lessard and Lorange in the control process?

Which of the following combinations of exchange rates was ruled out by Lessard and Lorange as illogical and unreasonable?

A _____ represents the remuneration paid to the owners of technology, patents, or trade names for the use of that technology or the right to manufacture and/or sell products under those patents or trade names.

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

Which of the following statements is true of tax havens?

The standards of U.S. Financial Accounting Standards Board and IASB are vastly different.

In countries such as the United States and Britain, firms typically raised capital by _____.

Using the ending rate to translate the budget is a valid practice according to the Lessard-Lorange Model.

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

Every time a firm changes cash from one currency into another currency it must bear a transaction cost.

The connection between cash flows to the parent and the source of financing must be recognized when performing capital budgeting for an international business.

Globalization

National Differences in Political Economy

Political Economy and Economic Development

Differences in Culture

Ethics in International Business

International Trade Theory

The Political Economy of International Trade

Foreign Direct Investment

Regional Economic Integration

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, Outsourcing, and Logistics

Global Marketing and RD

Global Human Resource Management

Filters

Exam 20: Accounting and Finance in the International Business

Briefly differentiate accounting standards and auditing standards.

Accounting standards _____.

What is capital budgeting?

Describe the structure of the International Accounting Standards Board (IASB).

The governments of some countries require or prefer foreign multinationals to finance projects in their country by local debt financing or local sales of equity.

_____ is the most common method by which firms transfer funds from foreign subsidiaries to the parent company.

A fronting loan is a loan between a parent and its subsidiary channeled through a financial intermediary.

Explain the concept of transfer pricing.

The projected rate will typically be the forward exchange rate as determined by the foreign exchange market when firms use the projected spot exchange rate to translate both the budget and performance figures into the corporate currency.

What are the nine possible combinations of the three exchange rates proposed by Lessard and Lorange in the control process?

Which of the following combinations of exchange rates was ruled out by Lessard and Lorange as illogical and unreasonable?

A _____ represents the remuneration paid to the owners of technology, patents, or trade names for the use of that technology or the right to manufacture and/or sell products under those patents or trade names.

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

Which of the following statements is true of tax havens?

The standards of U.S. Financial Accounting Standards Board and IASB are vastly different.

In countries such as the United States and Britain, firms typically raised capital by _____.

Using the ending rate to translate the budget is a valid practice according to the Lessard-Lorange Model.

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

Every time a firm changes cash from one currency into another currency it must bear a transaction cost.

The connection between cash flows to the parent and the source of financing must be recognized when performing capital budgeting for an international business.

Globalization

National Differences in Political Economy

Political Economy and Economic Development

Differences in Culture

Ethics in International Business

International Trade Theory

The Political Economy of International Trade

Foreign Direct Investment

Regional Economic Integration

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, Outsourcing, and Logistics

Global Marketing and RD

Global Human Resource Management

Filters