Fitzwater Limited (an Irish company) has a foreign subsidiary in Norway, whose manager is evaluated on the basis of profit in Euros (EUR). In the current year the foreign subsidiary was budgeted to generate a profit of 500,000 Norwegian kroner (NOK), and as actual profit for the year was NOK 480,000. Fitzwaters corporate management has calculated an unfavorable total budget variance for the foreign subsidiary of EUR 8,560. Current year actual and projected exchange rates are as follows:

Actual at time of budget preparation. EURO 0.116 per NOK 1

Projected ending at time of budget preparation. EURO 0.105 per NOK 1

Actual at end of budget period EURO 0.103 per NOK 1

1. Identify the combination of exchange rates (see exhibit 10.10) used by Fitzwaters corporate management in translating budgeted and actual amount that results in the total budget variance of EUR 8,560.

Exhibit 10.10

Rate used to track Actual Performance Relative to Budget Actual at Projecte Actual at Rate used for Determining Budget TOB d at TOB EOP Actual at time of budget (TOB) 1 n/a 41 Projected at time of budget n/a 3 Actual at end of period (EOP) n/a n/a 2 Rate used to track Actual Performance Relative to Budget Actual at Projecte Actual at Rate used for Determining Budget TOB d at TOB EOP Actual at time of budget (TOB) 1 n/a 41 Projected at time of budget n/a 3 Actual at end of period (EOP) n/a n/a 2