The French subsidiary of a Canadian parent has the following balance sheet (in euros):
$$\begin{array} { l r l r }
\text { Cash } & \text { EUR 200,000 } & \begin{array} { l }
\text { Current } \
\text { liabilities }
\end{array} & \text { EUR400,000 } \
\text { Receivables } & 300,000 & \text { Long-term debt } & 100,000 \
\text { Inventory } & 400,000 & & \
\text { Net plant \& } & \underline { 500,000 } & \text { Owner's equity } & \underline { 900,000 } \
\text { equipment } & \text { EUR1,400,000 } && \text { EUR1,400,000 }
\end{array}$$ The euro increases in value from EUR 1.6/C$ to EUR 1.3/C$.Using the current rate method,what happened to the total value of assets?

Question

The French subsidiary of a Canadian parent has the following balance sheet (in euros):
 $$\begin{array} { l r l r } 
\text { Cash } & \text { EUR 200,000 } & \begin{array} { l } 
\text { Current } \
\text { liabilities }
\end{array} & \text { EUR400,000 } \
\text { Receivables } & 300,000 & \text { Long-term debt } & 100,000 \
\text { Inventory } & 400,000 & & \
\text { Net plant \& } & \underline { 500,000 } & \text { Owner's equity } & \underline { 900,000 } \
\text { equipment } & \text { EUR1,400,000 } && \text { EUR1,400,000 }
\end{array}$$ The euro increases in value from EUR 1.6/C$ to EUR 1.3/C$.Using the current rate method,what happened to the total value of assets?

Quizplus · Accepted Answer

The Answer of The French subsidiary of a Canadian parent has the following balance sheet (in euros):
 $$\begin{array} { l r l r } 
\text { Cash } & \text { EUR 200,000 } & \begin{array} { l } 
\text { Current } \
\text { liabilities }
\end{array} & \text { EUR400,000 } \
\text { Receivables } & 300,000 & \text { Long-term debt } & 100,000 \
\text { Inventory } & 400,000 & & \
\text { Net plant \& } & \underline { 500,000 } & \text { Owner's equity } & \underline { 900,000 } \
\text { equipment } & \text { EUR1,400,000 } && \text { EUR1,400,000 }
\end{array}$$ The euro increases in value from EUR 1.6/C$ to EUR 1.3/C$.Using the current rate method,what happened to the total value of assets?

The French Subsidiary of a Canadian Parent Has the Following