Question
ABC Ltd purchased an asset of Rs.70 crore. As on date of
purchase, 1 USD was equivalent to Rs.70. the company paid after a year when the exchange rate changed to Rs.72.5 for a dollar. What would be the effect of exchange difference?ĀSolution
Asset value = Rs.70 crore Asset value in USD = 70,00,00,000 /70 = USD 10,000,000 = USD 10 mn Loss per USD = 72.5-70 = Rs.2.5 per USD Total loss = 2.5 * 10 mn = 2.5 crore
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