TEST BANK
All Chapters Included
1
, International Accounting, 6th Edition by Timothy Doupnik
TABLE OF CONTENT
Chapter 1:Introduction to International Accounting
Chapter 2:Worldwide Accounting Diversity
Chapter 3: International Convergence of Financial Reporting
Chapter 4:International Financial Reporting Standards: Part I
Chapter 5:International Financial Reporting Standards: Part II
Chapter 6:Foreign Currency Transactions and Hedging Foreign Exchange Risk
Chapter 7:Translation of Foreign Currency Financial Statements
Chapter 8:International Taxation
Chapter 9:International Transfer Pricing
Chapter 10:Management Accounting Issues in Multinational Corporations
Chapter 11:Auditing and Corporate Governance: An International Perspective
Chapter 12: International Sustainability Reporting
2
, ANSWERS ARE AT THE END OF EACH CHAPTER.
Answers Included
Chapter 01 6e
1) Which of the following groups is a supranational
organization?
A) International Accounting Standards Board
B) Organization for Economic Cooperation and Development
C) International Federation of Accountants
D) All of these answers are correct.
2) Determination of net present value involves:
A) forecasting future profits and cash flows.
B) discounting future cash flows back to their present value.
C) analysis on an after-tax basis.
D) All of these answers are correct.
3) In which of the following levels can international accounting be defined?
A) Supranational organizations
B) Company
C) Country
D) All of these answers are correct.
4) Which of the following functional areas is included in the study of international
accounting?
A) Financial accounting
B) Managerial
C) Taxation
D) All of these answers are correct.
5) The factor used to convert from one country's currency to another country's
currency is called the:
A) interest rate.
B) cost of capital.
C) exchange rate.
D) strike price.
3
, 6) What is the term used to describe the possibility that a foreign currency will
decrease in U.S. dollar value over the life of an asset such as Accounts
Receivable?
A) Foreign exchange translation
B) Foreign exchange risk
C) Hedging
D) Foreign currency options
7) Foreign exchange risk arises when:
A) business transactions are denominated in foreign currencies.
B) sales are made to customers in a domestic country.
C) goods or services purchased from suppliers in a foreign country are
denominated in domestic currency.
D) auditing reports are prepared in a foreign currency.
8) In international accounting, a "hedge" is:
A) a business transaction made to reduce the exposure of foreign exchange risk.
B) the legal barriers in various divisions of a multinational company.
C) the loss in US dollar resulting from a decline in the value of the US
dollar relative to foreign currencies.
D) a form of foreign direct investment.
9) Purchasing an option to buy foreign currency at a predetermined exchange
rate in order to reduce exchange risk is called:
A) transfer pricing.
B) hedging.
C) translating.
D) cross-listing.
10) What term is used to describe the process of reducing foreign exchange risk?
A) International accounting
B) Exposure
C) Hedging
D) Globalization
4
All Chapters Included
1
, International Accounting, 6th Edition by Timothy Doupnik
TABLE OF CONTENT
Chapter 1:Introduction to International Accounting
Chapter 2:Worldwide Accounting Diversity
Chapter 3: International Convergence of Financial Reporting
Chapter 4:International Financial Reporting Standards: Part I
Chapter 5:International Financial Reporting Standards: Part II
Chapter 6:Foreign Currency Transactions and Hedging Foreign Exchange Risk
Chapter 7:Translation of Foreign Currency Financial Statements
Chapter 8:International Taxation
Chapter 9:International Transfer Pricing
Chapter 10:Management Accounting Issues in Multinational Corporations
Chapter 11:Auditing and Corporate Governance: An International Perspective
Chapter 12: International Sustainability Reporting
2
, ANSWERS ARE AT THE END OF EACH CHAPTER.
Answers Included
Chapter 01 6e
1) Which of the following groups is a supranational
organization?
A) International Accounting Standards Board
B) Organization for Economic Cooperation and Development
C) International Federation of Accountants
D) All of these answers are correct.
2) Determination of net present value involves:
A) forecasting future profits and cash flows.
B) discounting future cash flows back to their present value.
C) analysis on an after-tax basis.
D) All of these answers are correct.
3) In which of the following levels can international accounting be defined?
A) Supranational organizations
B) Company
C) Country
D) All of these answers are correct.
4) Which of the following functional areas is included in the study of international
accounting?
A) Financial accounting
B) Managerial
C) Taxation
D) All of these answers are correct.
5) The factor used to convert from one country's currency to another country's
currency is called the:
A) interest rate.
B) cost of capital.
C) exchange rate.
D) strike price.
3
, 6) What is the term used to describe the possibility that a foreign currency will
decrease in U.S. dollar value over the life of an asset such as Accounts
Receivable?
A) Foreign exchange translation
B) Foreign exchange risk
C) Hedging
D) Foreign currency options
7) Foreign exchange risk arises when:
A) business transactions are denominated in foreign currencies.
B) sales are made to customers in a domestic country.
C) goods or services purchased from suppliers in a foreign country are
denominated in domestic currency.
D) auditing reports are prepared in a foreign currency.
8) In international accounting, a "hedge" is:
A) a business transaction made to reduce the exposure of foreign exchange risk.
B) the legal barriers in various divisions of a multinational company.
C) the loss in US dollar resulting from a decline in the value of the US
dollar relative to foreign currencies.
D) a form of foreign direct investment.
9) Purchasing an option to buy foreign currency at a predetermined exchange
rate in order to reduce exchange risk is called:
A) transfer pricing.
B) hedging.
C) translating.
D) cross-listing.
10) What term is used to describe the process of reducing foreign exchange risk?
A) International accounting
B) Exposure
C) Hedging
D) Globalization
4
