Back to School Offer

Get 20% of Your First Order amount back in Reward Credits!

Get 20% of Your First Orderback in Rewards

All papers examples
Get a Free E-Book! ($50 Value)
HIRE A WRITER!
Paper Types
Disciplines
Get a Free E-Book! ($50 Value)

Foreign Currency Exchange Rates, Essay Example

Pages: 1

Words: 315

Essay

The below article review is analyzing the steps of accounting processes within currency exchange, in particular focusing on the challenges of accounting in international trade when exchange of currencies is involved. The article reviewed is: Helbing, Duss (2012) Exchange rate Differences and foreign currency translation.

In accounting, it is extremely important to record exchange rates correctly. According to Helbing and Duss (2012), the reasons to keep accounts in a foreign currency are:

  • Competitiveness
  • Market domination
  • International compatibility

Converting amounts from one currency to another would be an advanced task for comparing prices of products or services in different countries and maintaining the competitiveness of the business by choosing cheaper suppliers. Purchasing Power Parity (PPP) is the method used in order to compare the average cost of services or goods between countries. (MaxiPedia, 2012) The calculation of PPP is very simple: the cost of goods in the first currency needs to be divided by the cost of goods in the second currency. However, this method only considers the average differences between currencies, and take into consideration the most likely exchange rate. When there is a fluctuation on the foreign exchange market and one of the currencies becomes significantly stronger than weaker than the average, deficits and surpluses would be created, and this would require the adjustment of accounts, as well as the business plans’. Depending on how long the deviance of the currency rate would last; important decisions need to be made to avoid loss and maintain the purchasing power parity and the competitiveness of the company on the global market. Payroll figures and costs of goods need to be converted to the currency using the PPP method, considering the revision of the currency pair exchange rates on a regular basis.(Helbing and Duss, 2012)

References

Helbing, Duss (2012) Exchange rate Differences and foreign currency translation. International Tax Review. February, 2012. Online.         <http://www.internationaltaxreview.com/Article/2981192/Exchange-rate-differences-and-foreign-currency-translation.html>

Purchasing Power Parity (PPP) Maxipedia.com. Online. < http://www.maxi-pedia.com/purchasing+power+parity> Retrieved: 10. 14. 2012.

Time is precious

Time is precious

don’t waste it!

Get instant essay
writing help!
Get instant essay writing help!
Plagiarism-free guarantee

Plagiarism-free
guarantee

Privacy guarantee

Privacy
guarantee

Secure checkout

Secure
checkout

Money back guarantee

Money back
guarantee

Related Essay Samples & Examples

Samples, Power Analysis, and Design Sensitivity Samples, Power Analysis, and Design Sensitivity, Essay Example

Compare and contrast internal and external validity. Describe and give examples of research questions for which external validity is a primary concern. Describe and give [...]

Pages: 5

Words: 1457

Essay

Business Responses, Essay Example

Idealized Attributes From the average above, I found out that the leader sometimes posses idealized attribute’s form of transformational leadership. This means that followers do [...]

Pages: 2

Words: 460

Essay

Types of Power, Essay Example

The videos taught me that there is not only one type of power but five types of powers which are referent power, reward power, legitimate [...]

Pages: 2

Words: 602

Essay

Criminal Justice: Juveniles, Essay Example

Juveniles are treated differently as compared to adult criminals. This is because most juveniles engage in petty cases and are not fully matured as to [...]

Pages: 3

Words: 769

Essay

Harris/Jardines Questions, Essay Example

Part One The issue of law considered by Kagan in this case is whether or not a drug detection dog’s alert during a traffic stop [...]

Pages: 3

Words: 772

Essay

Management Week 1 Assignment 3, Essay Example

We would like to own a Bed and Breakfast in the hill country outside of Austin, overlooking the beautiful Lake Austin.  It would be a [...]

Pages: 2

Words: 485

Essay

Samples, Power Analysis, and Design Sensitivity Samples, Power Analysis, and Design Sensitivity, Essay Example

Compare and contrast internal and external validity. Describe and give examples of research questions for which external validity is a primary concern. Describe and give [...]

Pages: 5

Words: 1457

Essay

Business Responses, Essay Example

Idealized Attributes From the average above, I found out that the leader sometimes posses idealized attribute’s form of transformational leadership. This means that followers do [...]

Pages: 2

Words: 460

Essay

Types of Power, Essay Example

The videos taught me that there is not only one type of power but five types of powers which are referent power, reward power, legitimate [...]

Pages: 2

Words: 602

Essay

Criminal Justice: Juveniles, Essay Example

Juveniles are treated differently as compared to adult criminals. This is because most juveniles engage in petty cases and are not fully matured as to [...]

Pages: 3

Words: 769

Essay

Harris/Jardines Questions, Essay Example

Part One The issue of law considered by Kagan in this case is whether or not a drug detection dog’s alert during a traffic stop [...]

Pages: 3

Words: 772

Essay

Management Week 1 Assignment 3, Essay Example

We would like to own a Bed and Breakfast in the hill country outside of Austin, overlooking the beautiful Lake Austin.  It would be a [...]

Pages: 2

Words: 485

Essay

Get a Free E-Book ($50 in value)

Get a Free E-Book

How To Write The Best Essay Ever!

How To Write The Best Essay Ever!