ha
gei
etexposurefortheCa
adia
dollara
dtheSwissfra
cCo
seque
tlyiftheeurodepreciatesagai
stthedollarfrom11000100to11786100asthetextexampleassumedexposedassetswill
owfalli
valuebyasmalleramou
ttha
exposedliabilitiesi
steadofviceversaTheassociatedreporti
gcurre
cyimbala
cewillbe239415calculatedasfollows
Reporti
gCurre
cyImbala
ce
39490000
39490000

11786100
11000100
239415
IM4
fTra
slatio
ExposureReportu
derFASB8forCe
traliaCorporatio
a
ditsMexica
a
dSpa
ish
AffiliatesDecember312005i
000Curre
cyU
its
Ca
adia

Mexica

Swiss
Dollar
Peso
Euro
Fra
c
Assets
Cash
CD200
Ps6000
825
SF0
Accou
tsreceivable
0
9000
1045
0
I
ve
tory
0
0
0
0
Netfixedassets
0
0
0
0
Exposedassets
CD200
Ps15000
1870
SF0
LiabilitiesAccou
tspayableNotespayableLo
gtermdebt
ExposedliabilitiesNetexposure
CD00
0CD0CD200
Ps700017000
27000Ps51000Ps36000
1364935
352058193949
SF01400
0SF1400SF1400
2AssumethatFASB8isstilli
effecti
steadofFASB52Co
structaco
solidatedbala
cesheetforCe
traliaCorporatio
a
ditsaffiliatesafteradepreciatio
oftheeurofrom11000100to11786100thatisthecou
terparttoExhibit108i
thetextCe
traliaa
ditsaffiliatescarryi
ve
torya
dfixedassetso
thebooksathistoricalvalues
Solutio
ThisproblemisthesequeltoProblem1Thesolutio
toProblem1showedthatiftheeurodepreciatedtherewouldbeareporti
gcurre
cyimbala
ceof239415U
derFASB8thisiscarriedthroughthei
comestateme
tasaforeig
excha
gegai
totheretai
edear
i
gso
thebala
cesheetThefollowi
gtableshowsthatco
solidatedretai
edear
i
gsi
creasedto4190000from3950000i
Exhibit108Thisisa
i
creaseof240000whichisthesameasthereporti
gcurre
cyimbala
ceafteraccou
ti
gforrou
di
gerror
IM5
fCo
solidatedBala
ceSheetu
derFASB8forCe
traliaCorporatio
a
ditsMexica
a
dSpa
ishAffiliatesDecember312005PostExcha
geRateCha
gei
000Dollars
Ce
traliaCorppare
t
Mexica
Affiliate
Spa
ishAffiliate
Co
solidatedBala
ceSheet
AssetsCashAccou
tsreceivable
950a1450b
600900
700887
22503237
I
ve
tory
3000
I
vestme
ti
Mexica
affiliatec
I
vestme
ti
Spa
ishaffiliated
1500
1500
6000
Netfixedassets
9000
4600
4000
17600
Totalassets
29087
Liabilitiesa
dNetWorthAccou
tspayableNotespayable
18002200
700b1700
11571043e
36574943
Lo
gtermdebtCommo
stockRetai
edear
i
gs
711035004190
2700cc
2987dd
1279735004190
Totalliabilitiesa
d
etworth
29087
aThisi
cludesCD200000thepare
tfirmhasi
aCa
adia
ba
kcarriedas150000CD200000CD13333100150000
b175000r