Net Income

Japanese

British

European

Chinese

Russian

U$.$S$.$

Consolidated

$($USD$)$

Subsidiary

Subsidiary

Subsidiary

Subsidiary

Subsidiary

Subsidiary

Earnings

$(2013)$

$15\mathrm{.}44$

$141\mathrm{.}41$

$277\mathrm{.}34$

$26\mathrm{.}36$

$4\mathrm{.}11$

$367\mathrm{.}35$

$832\mathrm{.}01$

$(2014)$

$13\mathrm{.}74$

$175\mathrm{.}15$

$298\mathrm{.}70$

$31\mathrm{.}96$

$3\mathrm{.}20$

$376\mathrm{.}06$

$898\mathrm{.}81$

Change $(\%)$

$8\mathrm{.}03$

Part $2$

b$.$ If the same exchange rates were used for both$$ years$-$what is often called a$$ "constant currency $$basis$"$long dashwas the change in corporate earnings on a constant currency$$ basis?

Calculate the earnings from individual subsidiaries and consolidation$$ below:$($Round to two decimal$$ places.$)$

Net Income

Japanese

British

European

Chinese

Russian

U$.$S$.$

Consolidated

$($USD$)$

Subsidiary

Subsidiary

Subsidiary

Subsidiary

Subsidiary

Subsidiary

Subsidiary

$(2014)$

$14\mathrm{.}90$

$162\mathrm{.}52$

$299\mathrm{.}70$

$32\mathrm{.}61$

$3\mathrm{.}89$

$376\mathrm{.}06$

$889\mathrm{.}68$

Change $(\%)$

$-3\mathrm{.}45$

$14\mathrm{.}93$

$8\mathrm{.}06$

$23\mathrm{.}69$

$-5\mathrm{.}39$

$2\mathrm{.}37$

$6\mathrm{.}93$

Part $3$

$($Select the best choice$$ below.$)$

A$.$

On a constant currency$$ basis, all subsidiaries showed growth in profits except for the European and Russian subsidiaries. Fortunately for$$ Blundell, neither of those subsidiaries is a major contributor to total profits.

B$.$

On a constant currency$$ basis, all subsidiaries showed growth in profits except for the Japanese and Russian subsidiaries. Fortunately for$$ Blundell, neither of those subsidiaries is a major contributor to total profits.

Your answer is correct.C$.$

On a constant currency$$ basis, all subsidiaries showed growth in profits except for the Japanese and Chinese subsidiaries. Fortunately for$$ Blundell, neither of those subsidiaries is a major contributor to total profits.

D$.$

On a constant currency$$ basis, all subsidiaries showed growth in profits except for the Chinese and Russian subsidiaries. Fortunately for$$ Blundell, neither of those subsidiaries is a major contributor to total profits.

Part $4$

c$.$ Using the results of the constant currency analysis in part$$ b$,$ is it possible to separate$$ Blundell's growth in earnings between local currency earnings and foreign exchange rate impacts on a consolidated$$ basis?

The foreign exchange rate change is

$$

negative $6\mathrm{.}482\%.($Round to two decimal$$ places.$)$

$)$The foreign exchange rate change is$($Round to two decimal places.$))$The foreign exchange rate change is$($Round to two decimal places.$)$