Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A multinational Corporation based in the United States of America has subsidiaries in the UK, Canada, and France. As at December 31, 2020, inter-company indebtedness

A multinational Corporation based in the United States of America has subsidiaries in the UK, Canada, and France. As at December 31, 2020, inter-company indebtedness were as follows:

Debtors

Creditors

Amount

Currency

UK

Canada

1,500,000

Can$

UK

France

600,000

Euro ()

France

Canada

800,000

Can$

Canada

UK

94,000

Sterling ()

Canada

France

400,000

Euro ()

It is the policy companys policy to net off inter-company balances to the greatest extent possible. The central treasury department is to use the following exchange rates for these purposes:

US$1 =Can$1.237/0.8620/0.729

Required:

Calculate the net payment to be made between the subsidiaries after netting off inter-company balances, by presenting the payoff in a matrix/table format.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Real Estate Investing Market Analysis Valuation Techniques And Risk Management

Authors: Benedetto Manganelli

1st Edition

3319063960,3319063979

More Books

Students also viewed these Finance questions