Question 1

Which of the following is an advantage of having a single set of accounting standards used worldwide?

Accepted Answer

A) Reduce the accounting costs for multinational corporations 
B) Increase the power of the FASB 
C) Reduce the number of multinational corporations on the NYSE 
D) Increase the diversity of accounting methods used by multinational corporations 
A) Reduce the accounting costs for multinational corporations 
B) Increase the power of the FASB 
C) Reduce the number of multinational corporations on the NYSE 
D) Increase the diversity of accounting methods used by multinational corporations A

Question 2

Purchasing an option to buy foreign currency at a predetermined exchange rate in order to reduce exchange risk is called:

Accepted Answer

A) transfer pricing. 
B) hedging. 
C) translating. 
D) cross-listing. 
A) transfer pricing. 
B) hedging. 
C) translating. 
D) cross-listing. B

Question 3

What is KPMG?

Accepted Answer

A) It is a Dutch manufacturing company with plants in over 50 countries worldwide. 
B) It is an international public accounting firm. 
C) It is the largest of the multinational corporations listed on the NYSE. 
D) It is a governmental agency whose aim is promoting international business. 
A) It is a Dutch manufacturing company with plants in over 50 countries worldwide. 
B) It is an international public accounting firm. 
C) It is the largest of the multinational corporations listed on the NYSE. 
D) It is a governmental agency whose aim is promoting international business. B

Question 4

What is the primary role of internal auditing in a multinational corporation?

Accepted Answer

A) To assist the external auditors in completing the financial statement audit in a timely fashion 
B) To make sure that employees comply with local customs and traditions 
C) To ensure that corporate policies and procedures are being followed and to assess operating efficiency 
D) To prepare the consolidated financial statement of the corporation in compliance with international accounting standards 
A) To assist the external auditors in completing the financial statement audit in a timely fashion 
B) To make sure that employees comply with local customs and traditions 
C) To ensure that corporate policies and procedures are being followed and to assess operating efficiency 
D) To prepare the consolidated financial statement of the corporation in compliance with international accounting standards

Question 5

Which of the following groups is a supranational organization?

Accepted Answer

A) United Nations 
B) Organization for Economic Cooperation and Development 
C) International Federation of Accountants 
D) All of the above 
A) United Nations 
B) Organization for Economic Cooperation and Development 
C) International Federation of Accountants 
D) All of the above

Question 6

The ownership and control of foreign assets such as a manufacturing plant is called:

Accepted Answer

A) a hedge. 
B) foreign direct investment. 
C) exposure. 
D) derivatives. 
A) a hedge. 
B) foreign direct investment. 
C) exposure. 
D) derivatives.

Question 7

In 2008 the country with the largest amount of exports was:

Accepted Answer

A) the United States of America. 
B) China. 
C) Japan. 
D) Germany. 
A) the United States of America. 
B) China. 
C) Japan. 
D) Germany.

Question 8

Which of the following is a reason a company might cross-list itself on a foreign stock exchange?

Accepted Answer

A) It wants to hedge against currency fluctuations. 
B) It is less expensive than listing itself solely on a domestic exchange. 
C) It wants to obtain acquisition currency for acquiring a foreign company. 
D) It is a means of accomplishing foreign direct investment. 
A) It wants to hedge against currency fluctuations. 
B) It is less expensive than listing itself solely on a domestic exchange. 
C) It wants to obtain acquisition currency for acquiring a foreign company. 
D) It is a means of accomplishing foreign direct investment.

Question 9

What is the entry point for most companies into the world of international business?

Accepted Answer

A) Shanghai 
B) exporting 
C) foreign direct investment 
D) cross-listing on international stock exchanges 
A) Shanghai 
B) exporting 
C) foreign direct investment 
D) cross-listing on international stock exchanges

Question 10

The 100 largest multinational companies generate what share of the world's Gross Domestic Product (GDP)?

Accepted Answer

A) 4% 
B) 20% 
C) 50% 
D) 75% 
A) 4% 
B) 20% 
C) 50% 
D) 75%

Question 11

The number of companies involved in international trade has grown significantly in recent years. What percent of U.S.exporters are relatively small (i.e.less than 500 employees)?

Accepted Answer

A) Less than 5% 
B) 10% 
C) 25% 
D) more than 90% 
A) Less than 5% 
B) 10% 
C) 25% 
D) more than 90%

Question 12

Why is auditing a multinational corporation potentially more difficult than auditing an entity that has only domestic operations?

Accepted Answer

A) Language differences 
B) Cultural differences 
C) Multiple sets of accounting standards 
D) All of the above 
A) Language differences 
B) Cultural differences 
C) Multiple sets of accounting standards 
D) All of the above

Question 13

Many countries have recently liberalized their investment laws. What is the primary reason for these actions?

Accepted Answer

A) To make it more difficult for multinational companies to compete with domestic corporations 
B) To encourage foreign direct investment 
C) To enable funds to flow out of their country more easily 
D) To make taxing foreign companies easier 
A) To make it more difficult for multinational companies to compete with domestic corporations 
B) To encourage foreign direct investment 
C) To enable funds to flow out of their country more easily 
D) To make taxing foreign companies easier

Question 14

Which of the following statements is true about U.S.taxation of foreign subsidiaries?

Accepted Answer

A) The U.S.does not tax income generated on subsidiaries incorporated in foreign countries. 
B) U)S.multinationals pay tax on their worldwide income as soon as it is earned. 
C) Transfer pricing will eliminate taxes by the U.S.government on multinational corporations. 
D) U)S.tax on foreign operations does not have to be paid until the income is brought back to the United States. 
A) The U.S.does not tax income generated on subsidiaries incorporated in foreign countries. 
B) U)S.multinationals pay tax on their worldwide income as soon as it is earned. 
C) Transfer pricing will eliminate taxes by the U.S.government on multinational corporations. 
D) U)S.tax on foreign operations does not have to be paid until the income is brought back to the United States.

Question 15

What is one reason for the tremendous increase in the flow of foreign direct investment from 1982 to 2007?

Accepted Answer

A) Transfer pricing 
B) The liberalization of investment laws in many countries 
C) The similarities in tax rates and tax laws across the globe 
D) The availability of hedging instruments 
A) Transfer pricing 
B) The liberalization of investment laws in many countries 
C) The similarities in tax rates and tax laws across the globe 
D) The availability of hedging instruments

Question 16

Which of the following is a reason for foreign direct investment?

Accepted Answer

A) Reduce costs of doing business 
B) Protect domestic markets 
C) Protect foreign markets 
D) All of the above 
A) Reduce costs of doing business 
B) Protect domestic markets 
C) Protect foreign markets 
D) All of the above

Question 17

Which of the following is an example of a greenfield investment?

Accepted Answer

A) Nike contracts with a footwear company in China to make athletic shoes. 
B) A Chinese oil company buys a U.S.oil company. 
C) Toyota,a Japanese automaker,builds an assembly plant in Ohio. 
D) Daimler,a German automaker,merges with Chrysler,a U.S.automaker. 
A) Nike contracts with a footwear company in China to make athletic shoes. 
B) A Chinese oil company buys a U.S.oil company. 
C) Toyota,a Japanese automaker,builds an assembly plant in Ohio. 
D) Daimler,a German automaker,merges with Chrysler,a U.S.automaker.

Question 18

What is a "greenfield" investment?

Accepted Answer

A) Farm land held for speculation 
B) Foreign direct investment whereby a new facility is constructed abroad 
C) Purchasing an existing facility as a foreign direct investment 
D) A foreign investment that has been approved by the Environmental Protection Agency 
A) Farm land held for speculation 
B) Foreign direct investment whereby a new facility is constructed abroad 
C) Purchasing an existing facility as a foreign direct investment 
D) A foreign investment that has been approved by the Environmental Protection Agency

Question 19

What term is used to describe the process of reducing foreign exchange risk?

Accepted Answer

A) international accounting 
B) exposure 
C) hedging 
D) globalization 
A) international accounting 
B) exposure 
C) hedging 
D) globalization

Question 20

A translation adjustment may be necessary when:

Accepted Answer

A) notes to financial statements are converted from one language to another. 
B) foreign currency financial statements are converted to another currency. 
C) consolidated financial statements are prepared. 
D) hedging foreign currency. 
A) notes to financial statements are converted from one language to another. 
B) foreign currency financial statements are converted to another currency. 
C) consolidated financial statements are prepared. 
D) hedging foreign currency.

Which of the following is an advantage of having a single set of accounting standards used worldwide?

Purchasing an option to buy foreign currency at a predetermined exchange rate in order to reduce exchange risk is called:

What is KPMG?

What is the primary role of internal auditing in a multinational corporation?

Which of the following groups is a supranational organization?

The ownership and control of foreign assets such as a manufacturing plant is called:

In 2008 the country with the largest amount of exports was:

Which of the following is a reason a company might cross-list itself on a foreign stock exchange?

What is the entry point for most companies into the world of international business?

The 100 largest multinational companies generate what share of the world's Gross Domestic Product (GDP)?

The number of companies involved in international trade has grown significantly in recent years. What percent of U.S.exporters are relatively small (i.e.less than 500 employees)?

Why is auditing a multinational corporation potentially more difficult than auditing an entity that has only domestic operations?

Many countries have recently liberalized their investment laws. What is the primary reason for these actions?

Which of the following statements is true about U.S.taxation of foreign subsidiaries?

What is one reason for the tremendous increase in the flow of foreign direct investment from 1982 to 2007?

Which of the following is a reason for foreign direct investment?

Which of the following is an example of a greenfield investment?

What is a "greenfield" investment?

What term is used to describe the process of reducing foreign exchange risk?

A translation adjustment may be necessary when:

Worldwide Accounting Diversity

International Convergence of Financial Reporting

International Financial Reporting Standards: Part I

International Financial Reporting Standards: Part II

Comparative Accounting

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Additional Financial Reporting Issues

Analysis of Foreign Financial Statements

International Taxation

International Transfer Pricing

Strategic Accounting Issues in Multinational Corporations

Comparative International Auditing and Corporate Governance

International Corporate Social Reporting

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Exam 1: Introduction to International Accounting

Which of the following is an advantage of having a single set of accounting standards used worldwide?

Purchasing an option to buy foreign currency at a predetermined exchange rate in order to reduce exchange risk is called:

What is KPMG?

What is the primary role of internal auditing in a multinational corporation?

Which of the following groups is a supranational organization?

The ownership and control of foreign assets such as a manufacturing plant is called:

In 2008 the country with the largest amount of exports was:

Which of the following is a reason a company might cross-list itself on a foreign stock exchange?

What is the entry point for most companies into the world of international business?

The 100 largest multinational companies generate what share of the world's Gross Domestic Product (GDP)?

The number of companies involved in international trade has grown significantly in recent years. What percent of U.S.exporters are relatively small (i.e.less than 500 employees)?

Why is auditing a multinational corporation potentially more difficult than auditing an entity that has only domestic operations?

Many countries have recently liberalized their investment laws. What is the primary reason for these actions?

Which of the following statements is true about U.S.taxation of foreign subsidiaries?

What is one reason for the tremendous increase in the flow of foreign direct investment from 1982 to 2007?

Which of the following is a reason for foreign direct investment?

Which of the following is an example of a greenfield investment?

What is a "greenfield" investment?

What term is used to describe the process of reducing foreign exchange risk?

A translation adjustment may be necessary when:

Worldwide Accounting Diversity

International Convergence of Financial Reporting

International Financial Reporting Standards: Part I

International Financial Reporting Standards: Part II

Comparative Accounting

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Additional Financial Reporting Issues

Analysis of Foreign Financial Statements

International Taxation

International Transfer Pricing

Strategic Accounting Issues in Multinational Corporations

Comparative International Auditing and Corporate Governance

International Corporate Social Reporting

Filters