Which of the Following Is an Indication That the Functional

question 30

Multiple Choice

Which of the following is an indication that the functional currency of a foreign operation is not the Canadian dollar?

• A) Only goods imported from the parent are sold by the subsidiary.
• B) The parent dictates the subsidiary's operating procedures.
• C) Cash to pay obligations is generated by local operations or borrowed from local lenders.
• D) Intercompany transactions account for a high proportion of the subsidiary's overall activities.

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Definitions:

Probability

The measure of the likelihood that an event will occur, expressed as a number between 0 (impossible) and 1 (certain).

Poisson Probability

A distribution used to predict the probability of a given number of events happening in a fixed interval of time or space, given a constant mean rate of occurrence.

Defects

Imperfections or faults in a product or process that deviate from desired performance or specification.

Normal Distribution

This denotes a probability distribution with symmetry at the mean, proving that nearer-to-mean data points occur more regularly than those farther away.