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A U.S. firm has total assets valued at €806,000 located in Germany. This valuation did not...

A U.S. firm has total assets valued at €806,000 located in Germany. This valuation did not change from last year. Last year, the exchange rate was €.9464/$. Today, the exchange rate is €.8985/$. By what amount did these assets change in value on the firm's U.S. financial statements?

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Answer #1

The value of the assets in Germany = €806,000

The value of the assets in the U.S. last year = 806,000/€.9464/$ = $851,648.351648352

The value of the assets in the U.S. this year = 806,000/€.8985/$ = $897,050.639955481

Change in value of the assets on the firm's U.S. financial statements = 897,050.639955481/851,648.351648352 -1

Change in value of the assets on the firm's U.S. financial statements = 0.05331107401

Change in value of the assets on the firm's U.S. financial statements = 5.331107401%

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