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A foreign subsidiary's depreciation expense was reported in the parent's consolidated income statement as $6,000. The depreciable asset was bought when the direct exchange rate
A foreign subsidiary's depreciation expense was reported in the parent's consolidated income statement as $6,000. The depreciable asset was bought when the direct exchange rate was 0.60:1. The purchase was made before the subsidiary was acquired by the parent. The exchange rate was 0.75:1 when the subsidiary was acquired. The average exchange rate this period was 0.85:1 and the ending exchange rate was 1.00:1. How much depreciation expense did the foreign subsidiary report in its own currency? The dollar is the functional currency.
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