_____ During 2006, a foreign subsidiary had fixed assets of 100,000 local currency units that were financed with nonindexed local currency debt. Assume that the direct exchange rate decreased by $.07 during 2006, which was the result of foreign inflation. How much would the consolidated stockholders' equity change in U.S. dollars under the current rate method?
A) $-0-
B) $7,000 increase.
C) $7,000 decrease.

Question

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The Answer of _____ During 2006, a foreign subsidiary had fixed assets of 100,000 local currency units that were financed with nonindexed local currency debt. Assume that the direct exchange rate decreased by $.07 during 2006, which was the result of foreign inflation. How much would the consolidated stockholders' equity change in U.S. dollars under the current rate method?
A) $-0-
B) $7,000 increase.
C) $7,000 decrease.

_____ During 2006, a Foreign Subsidiary Had Fixed Assets of 100,000