What Is the Primary Difference Between Transaction Exposure and Accounting

question 8

Multiple Choice

What is the primary difference between transaction exposure and accounting exposure?

• A) Transaction exposure results from changes in currency exchange rates, whereas accounting exposure is the result of changes in accounting method.
• B) Transaction exposure results in changes in cash flow, whereas accounting exposure does not necessarily result in changes in cash flow.
• C) Transaction exposure must be hedged, but accounting exposure does not need to be hedged.
• D) Transaction exposure affects only monetary assets and liabilities, whereas accounting exposure affects all assets and liabilities.

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Definitions:

Job Status

The relative importance or prestige assigned to a job or position within an organization, which can affect motivation and job satisfaction.

Competency Approach

A methodology that prioritizes the skills, knowledge, and behaviors necessary for effective performance in a job role.

Job Evaluation

The systematic process of determining the relative worth of jobs within an organization to establish fair compensation.

Priority

The level of importance assigned to tasks or goals, guiding the order or attention they receive.