How Should U

question 45

Multiple Choice

How should U.S.companies record receivables and payables from international trade that are denominated in foreign currencies?

• A)All assets and liabilities of U.S.companies must be recorded in U.S.dollars.
• B)Conservatism would dictate that liabilities should be recorded in the currency in which they are payable, but assets should be recorded in U.S.dollars, regardless of what currency will be received.
• C)There should be separate receivable and payable accounts for each currency that is used by the company.
• D)The company should choose any one currency to use for recording receivable and payables so that there is consistency in the accounts.

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