Redline Products, Inc. is a U.S.-based multinational with subsidiaries around the world. One such subsidiary, Acceletron, operates in Singapore, which has seen mild but not excessive rates of inflation. Acceletron was acquired in 2000 and has never paid a dividend. It records inventory using the FIFO method.

Chief Financial Officer Margot Villiers was asked by Redlines Board of Directors to explain how the functional currency selection and other accounting choices affect Redlines consolidated financial statements. She gathers Acceletrons financial statements denominated in Singapore dollars (SGD) and the U.S. dollar/Singapore dollar exchange rates in the tables below. She does not intend to identify the functional currency actually in use, but rather to use Acceletron as an example of how the choice of functional currency affects the consolidated statements.

Selected Financial Data for Acceletron
31 December 2016 (in SGD millions)
Cash	SGD	125
Accounts receivable		230
Inventory		500
Fixed assets		1,640
Accumulated depreciation		(205)
Total assets	SGD	2,290
Accounts payable		185
Long-term debt		200
Common stock		620
Retained earnings		1,285
Total liabilities and equity		2,290
Total revenues	SGD	4,800
Net Income	SGD	450
Exchange Rates Applicable to Acceletron
Exchange Rate in Effect at Specific Times		USD per SGD
Rate when first 1,000 of fixed assets were acquired		0.568
Rate when remaining 640 of fixed assets were acquired		0.606
Rate when long-term debt was issued		0.588
31 December 2015		0.649
Weighted average rate when inventory was acquired		0.654
Average rate in 2016		0.662
31 December 2016		0.671

30. Compared to using the Singapore dollar as Acceletrons functional currency for 2016, if the U.S. dollar were the functional currency, it is most likely that Redlines consolidated:

1. inventories will be higher.
2. receivable turnover will be lower.
3. fixed asset turnover will be higher.

31. If the U.S. dollar were chosen as the functional currency for Acceletron in 2016, Redline could reduce its balance sheet exposure to exchange rates by:

1. issuing SGD 30 of long-term debt to buy fixed assets.
2. selling SGD 30 of fixed assets for cash.
3. issuing SGD 30 in short-term debt to purchase marketable securities.

32. Redlines consolidated gross profit margin for 2016 would be highest if Acceletron accounted for inventory using:

1. LIFO, and its functional currency were the U.S. dollar.
2. FIFO, and its functional currency were the Singapore dollar.
3. FIFO, and its functional currency were the U.S. dollar.

33. If the current rate method is used to translate Acceletrons financial statements into U.S. dollars, Redlines consolidated financial statements will most likely include Acceletrons:

1. $118 in long-term debt.
2. negative translation adjustment to shareholder equity.
3. $3,178 in revenues.

34. If Acceletrons financial statements are translated into U. S. dollars using the temporal method, Redline's consolidated financial statements will most likely include Acceletrons:

1. $336 in inventory.
2. $956 in fixed assets.
3. $152 in accounts receivable.

35. When translating Acceletrons financial statements into U.S. dollars, Redline is least likely to use an exchange rate of USD per SGD:

1. 0.588.
2. 0.671.
3. 0.654.