A- Assume that an Italian corporation exports electronic equipment to USA in a transaction denominated in dollar. Is this transaction a foreign currency transaction? Is it a foreign transaction? Explain the difference between these two concepts and their application here. B- “Exchange losses arise from foreign import activities, and exchange gains arise from foreign export activities.”. Discuss the accuracy of this statement and support your answer with a numerical example.
C- Penguin Corporation paid $16,200 for a 90% interest in Seagull Corporation on January 1, 2019, when Seagull stockholders’ equity consisted of $10,000 Capital Stock and $3,000 of Retained Earnings. The excess cost over book value was attributable to goodwill.