That US parent company ABC has a subsidiary XYZ in Outer Mongolia. XYZ's total assets are as follows in Mongolian marks:
•cash and receivables 500,000
•fixed assets (net) 900,000
•inventory 500,000
The relevant exchange rates are:
•OMM 1.5500 exchange rate when the fixed assets were acquired
•OMM 1.6800 closing rate on the balance sheet date
•OMM 1.6600 average exchange rate when ending inventory was acquired
•OMM 1.6300 average exchange rate for the period
Evaluate what is the total value of assets if the functional currency is the Outer Mongolian mark?
a. $1,130,952
b. $1,175,883
c. $1,179,469
d. $1,185,012