Question: 1 . A U . K . resident buys Facebook shares, paying the equivalent of $ 5 0 0 0 Debit: Long term portfolio /
A UK resident buys Facebook shares, paying the equivalent of $
Debit: Long term portfolio FDI???
Amount: $
Reasoning: Increase in US ownership of a foreign asset
Credit: Long term portfolio
Amount: $
Reasoning: Decrease in UK ownership of a US asset outflow of capital from the UK
Academy Sports Outdoors imports $ million worth of sports equipment from Vietnam to the USA.
Debit: Goods
Amount: $M
Reasoning: import of goods from Vietnam
Credit: Short Term Portfolio
Amount: $ million
Reasoning: increase in foreign ownership of USD
A Canadian entrepreneur seeking to sell souvenirs at the Superbowl in New Orleans, pays American Airlines $ for a Toronto New Orleansroundtrip ticket.
Debit: Short Term Portfolio
Amount: $
Reasoning: Decrease in foreign ownership of a US asset
Credit: Service
Amount $
Reasoning: Export of a service
The US government gives Ethiopia $ million worth of food for humanitarian aid.
Debit: giftsunilateral transfers
Amount: $ million
Reasoning: gift given to foreign entity
Credit: Short term portfolio GOODS?
Amount: $ million
Reasoning: Decrease in US assets outflow of goods without receiving payment Ford Motor Company US pays $ billion to purchase all the common stock of the Jaguar Motor Company UK
Debit: Foreign Direct Investment
Amount: $ billion
Reasoning: Increase in US ownership of a foreign asset
Credit: Foreign Direct Investment
Amount: $ billion
Reasoning: Decrease in UK ownership of a US asset outflow of capital to acquire a foreign company
begintabularccccccc
hline multirowt & multicolumncCURRENT ACCOUNT & multicolumncCAPITAL ACCOUNT
hline & & DEBit & CREDIT & & DEBIT & CREDIT
hline multirowtbegintabularl
Accounting students:
NOTE
Debits outflows Credits Inflows
endtabular & GOODS & IMPORT & EXPORT & FPI & Increase in & Increase in
hline & SERVICES & IMPORT & EXPORT & begintabularl
STP
one year or less
endtabular & us ownership & foreign ownership
hline & INVESTMENT INCOME & PAY & RECEIVE & LTP & of a foreign asset or decrease in & of a US asset or decrease in
hline & GIFTS UNILATERAL TRANSFERS & GIVE & RECEIVE & FDI & foreign ownership of a US asset & US ownership of a foreign asset
hline multirowt
beginarrayl
text SIMPLIFIED
text HYPOTHETICAL
text CHART
endarray
& multicolumnlOFFICIAL RESERVE ACCOUNT & multicolumnlERRORS AND OMISSIONS
hline & multicolumnlGold & multicolumnl
hline & multicolumnlConvertible currencies & multicolumnlPLUG FIGURE to make the
hline & multicolumnlSpecial Drawing Rights SDRs & multicolumnlcurrentcapital official reserve
hline & multicolumnlReserve positions at the IMF & & &
hline
endtabular
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