Question 1

A tax credit allows an entity to reduce the taxes paid to the home government by the amount of taxes paid to the foreign government.

Accepted Answer

A) True 
 B)False

Question 2

The _____ writes the generally accepted accounting principles (GAAP)that govern the financial statements of U.S.firms.

Accepted Answer

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

Question 3

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 4

A European subsidiary of a U.S.firm will usually prepare its budgets in Euro.

Accepted Answer

A) True 
 B)False

Question 5

Multilateral netting is used majorly to _____.

Accepted Answer

A)  reduce the number of transactions between subsidiaries 
B)  avail tax credit from governments 
C)  establish a tax treaty amongst multiple countries 
D)  to reduce the fixed costs of establishing a subsidiary 
A)  reduce the number of transactions between subsidiaries 
B)  avail tax credit from governments 
C)  establish a tax treaty amongst multiple countries 
D)  to reduce the fixed costs of establishing a subsidiary

Question 6

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 7

Money management decisions attempt to manage the firm's working capital most efficiently.

Accepted Answer

A) True 
 B)False

Question 8

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 9

Which of the following is a disadvantage of comparing managers in different countries only on the basis of return on investment?

Accepted Answer

A)  The managers are not responsible for increasing the ROI of an organization. 
B)  Managerial actions do not have a significant impact on firms' profitability. 
C)  Return on investment is not a valid indicator of organizational profitability. 
D)  Environmental factors also contribute to ROI of firms and these factors differ. 
A)  The managers are not responsible for increasing the ROI of an organization. 
B)  Managerial actions do not have a significant impact on firms' profitability. 
C)  Return on investment is not a valid indicator of organizational profitability. 
D)  Environmental factors also contribute to ROI of firms and these factors differ.

Question 10

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 11

Briefly differentiate accounting standards and auditing standards.

Accepted Answer

Accounting standards are rules for prepa

Question 12

What are the shortcomings of IASB?

Accepted Answer

To issue a new standard,75 percent of th

Question 13

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

Accepted Answer

If external financing is required,the fi

Question 14

The International Accounting Standards Board _____.

Accepted Answer

A)  can issue a new accounting standard if majority of the board members agree 
B)  was formed to replace the Financial Accounting Standards Board 
C)  proposes standards but has no power to enforce the standards 
D)  was formed to supervise the accounting practices that U.S.firms follow 
A)  can issue a new accounting standard if majority of the board members agree 
B)  was formed to replace the Financial Accounting Standards Board 
C)  proposes standards but has no power to enforce the standards 
D)  was formed to supervise the accounting practices that U.S.firms follow

Question 15

The price at which goods and services are transferred between subsidiary companies in a multi-national firm is referred to as minimum retail price.

Accepted Answer

A) True 
 B)False

Question 16

A deferral principle specifies that parent companies are not taxed on foreign source income until _____.

Accepted Answer

A)  the subsidiary providing income makes some profit 
B)  they actually receive a dividend 
C)  they acquire majority stake in the subsidiary 
D)  the subsidiary providing income is listed in the U.S. 
A)  the subsidiary providing income makes some profit 
B)  they actually receive a dividend 
C)  they acquire majority stake in the subsidiary 
D)  the subsidiary providing income is listed in the U.S.

Question 17

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 18

When using the projected spot exchange rate to translate both the budget and performance figures into the corporate currency,the projected rate in such cases will typically be the _____.

Accepted Answer

A)  forward exchange rate as determined by the foreign exchange market 
B)  exchange rate that exists at the start of a project 
C)  exchange rate when the budget was prepared 
D)  transfer price that a firm will offer to one or more of its subsidiaries 
A)  forward exchange rate as determined by the foreign exchange market 
B)  exchange rate that exists at the start of a project 
C)  exchange rate when the budget was prepared 
D)  transfer price that a firm will offer to one or more of its subsidiaries

Question 19

A _____ 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 20

What are the advantages of using royalties and fees to move money across borders?

Accepted Answer

Royalties and fees have certain tax adva

A tax credit allows an entity to reduce the taxes paid to the home government by the amount of taxes paid to the foreign government.

The _____ writes the generally accepted accounting principles (GAAP)that govern the financial statements of U.S.firms.

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

A European subsidiary of a U.S.firm will usually prepare its budgets in Euro.

Multilateral netting is used majorly to _____.

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

Money management decisions attempt to manage the firm's working capital most efficiently.

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

Which of the following is a disadvantage of comparing managers in different countries only on the basis of return on investment?

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

Briefly differentiate accounting standards and auditing standards.

What are the shortcomings of IASB?

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

The International Accounting Standards Board _____.

The price at which goods and services are transferred between subsidiary companies in a multi-national firm is referred to as minimum retail price.

A deferral principle specifies that parent companies are not taxed on foreign source income until _____.

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.

When using the projected spot exchange rate to translate both the budget and performance figures into the corporate currency,the projected rate in such cases will typically be the _____.

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

What are the advantages of using royalties and fees to move money across borders?

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

A tax credit allows an entity to reduce the taxes paid to the home government by the amount of taxes paid to the foreign government.

The _____ writes the generally accepted accounting principles (GAAP)that govern the financial statements of U.S.firms.

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

A European subsidiary of a U.S.firm will usually prepare its budgets in Euro.

Multilateral netting is used majorly to _____.

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

Money management decisions attempt to manage the firm's working capital most efficiently.

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

Which of the following is a disadvantage of comparing managers in different countries only on the basis of return on investment?

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

Briefly differentiate accounting standards and auditing standards.

What are the shortcomings of IASB?

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

The International Accounting Standards Board _____.

The price at which goods and services are transferred between subsidiary companies in a multi-national firm is referred to as minimum retail price.

A deferral principle specifies that parent companies are not taxed on foreign source income until _____.

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.

When using the projected spot exchange rate to translate both the budget and performance figures into the corporate currency,the projected rate in such cases will typically be the _____.

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

What are the advantages of using royalties and fees to move money across borders?

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