U S Multinational Corporations subsidiary in Bangkok has on its books fixed assets valued at 7,500,000 baht One third of the assets were acquired two years ago when the exchange rate was THB40 $1 The other fixed assets were acquired last year when the exchange rate was THB38 $1 Each layer of fixed ...

a Baht is the functional currency B 250000020 years B 125000 ...

U.S. Multinational Corporations subsidiary in Bangkok has on its books fixed assets valued at 7,500,000 baht. One-third

Question:

U.S. Multinational Corporation’s subsidiary in Bangkok has on its books fixed assets valued at 7,500,000 baht. One-third of the assets were acquired two years ago when the was THB40 = $1. The other fixed assets were acquired last year when the was THB38 = $1. Each layer of fixed assets is being depreciated straight-line with an estimated useful life of 20 years. Relevant exchange rates for the current year are:
Year-end rate: THB34 = $1
Average rate: THB35 = $1
Required:
a. Calculate the Thai subsidiary’s depreciation expense for the current year, assuming the baht is the functional currency.
b. Repeat requirement a., assuming instead that the U.S. dollar is the functional currency.

Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...