A Foreign Subsidiary's ________ Currency Is the Currency Used in the Firm's

question 23

Multiple Choice

A foreign subsidiary's ________ currency is the currency used in the firm's day-to-day operations.

• A) local
• B) integrated
• C) notational dollar
• D) functional

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Definitions:

Pre-Tax Book Income

The income of a company before taxes as reported in its financial statements, according to accounting principles.

Taxable Income

Income on which tax must be paid. Total income minus exemptions and deductions is used to calculate this figure.

Income Tax Expense

The amount of expense recognized in a given period for taxes on profits, reflecting the expected cash outflow to tax entities.

Loss Carryback

A tax provision that allows businesses to apply a net operating loss to past tax years in order to receive a tax refund.