The General Rule for Translating Liabilities Denominated in a Foreign

question 2

Multiple Choice

The general rule for translating liabilities denominated in a foreign currency into the functional currency is to:

• A) first classify the liabilities into current and non-current.
• B) first classify the liabilities as monetary or non-monetary.
• C) translate all liabilities using the current rate existing at end of reporting period.
• D) translate all liabilities using the rate current on entering into the transaction.

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Definitions:

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