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U.S. Multinational Corporation’s subsidiary in Bangkok has on its books fixed assets

U.S. Multinational Corporation’s subsidiary in Bangkok has on its books fixed assets valued at 7,500,000 baht. One-third of the assets were acquired two years ago when the exchange rate was THB40 = $1. The other fixed assets were acquired last year when the exchange rate was THB38 = $1. Each layer of fixed assets is being depreciated straight-line with an estimated useful life of 20 years. Relevant exchange rates for the current year are:Year-end rate: THB34 = $1 Average rate: THB35 = $1Required: a. Calculate the Thai subsidiary’s depreciation expense for the current year, assuming the baht is the functional currency. b. Repeat requirement a., assuming instead that the U.S. dollar is the functional currency.

Feb 06 2020 View more View Less

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