An American company has an overseas subsidiary that builds its products for sale in the United STates. If that subsidiary shows large unhedged FX translation gains, what is the effect on their US consolidated income? a. none, since the translation gains go to a reserve account.
b. Since integrated subsidiaries use the temporal method, gains flow through to consolidated income
c. since integrated subsidiaries use the current rate method, there is no effect
d. gains flow through to consolidated income, since integrated subsidiaries use the current rate method (market to market)

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation:

answerit is the safest endorsement for business;