What Is a Company's Functional Currency

question 16

Multiple Choice

What is a company's functional currency?

• A) The currency of the primary economic environment in which it operates.
• B) The currency of the country where it has its headquarters.
• C) The currency in which it prepares its financial statements.
• D) The reporting currency of its parent for a subsidiary.
• E) The currency it chooses to designate as such.

---

Definitions:

Exponentiation

A mathematical operation involving two numbers, where one number, the base, is raised to the power of the other, the exponent.

Exponentiation

The operation of raising one number (the base) to the power of another (the exponent), a fundamental mathematical operation.

System of Equations

A set of two or more equations that share two or more unknowns.

Coefficient

A numerical or constant factor before and multiplying the variable in an algebraic expression.