At what amount subsidiary cost of goods sold reflected

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Question - A U.S. company's foreign subsidiary had these amounts in local currency units (LCU) in 2017:

Cost of goods sold LCU 5,130,000

Beginning inventory 526,000

Ending inventory 609,000

The average exchange rate during 2017 was $1.20 = LCU 1. The beginning inventory was acquired when the exchange rate was $1.00 = LCU 1. Ending inventory was acquired when the exchange rate was $1.30 = LCU 1. The exchange rate at December 31, 2017, was $1.35 = LCU 1. Assuming that the foreign country is highly inflationary, at what amount should the foreign subsidiary's cost of goods sold be reflected in the U.S. dollar income statement?

Reference no: EM132562895

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