Patents are on the books of a British subsidiary of a U.S. firm at a value of 50,000 pounds. The patents were acquired in 2016 when the exchange rate was 1 pound = $1.50
The British subsidiary was acquired by the U.S. firm in 20X0 when the exchange rate was 1 pound = $1.40 . The exchange rate on December 31, 2017, the date of the most current balance sheet, is 1 pound = $1.55 . The average rate of exchange for 2017 is $1.53 . Assuming the pound is the functional currency of the subsidiary, what exchange rate will be used to translate patents for the consolidated statements dated December 31, 2017?
a. $1.40
b. $1.50
c. $1.53
d. $1.55
d
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