Exchange Differences Arising When Translating from the Functional Currency into the Presentation

question 1

Multiple Choice

Exchange differences arising when translating from the functional currency into the presentation currency are recognised in other comprehensive income and:

• A) recorded as a deferred asset and amortised over the expected useful life.
• B) recognised in profit or loss.
• C) accumulated in equity using a 'foreign currency translation reserve'.
• D) accumulated in equity using retained earnings.

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Definitions:

Experimental Studies

Research methodologies that involve the manipulation of variables to determine cause-and-effect relationships.

Mental Process

An internal, covert activity of the mind involving thinking, perception, memory, and reasoning.

Behavior

The way in which one acts or conducts oneself, especially towards others, influenced by the interplay of individual and environmental factors.

Natural Selection

The principle that, among the range of inherited trait variations, those that lead to increased reproduction and survival will most likely be passed on to succeeding generations.