When the Parent Company of a Foreign Subsidiary Believes That

question 4

Multiple Choice

When the parent company of a foreign subsidiary believes that all of its investment in the subsidiary is exposed to foreign exchange risk,what method of translation should be used in consolidating the financial statements?

• A)current rate method
• B)current/noncurrent method
• C)monetary/nonmonetary method
• D)temporal method

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Definitions:

Negligence

The failure to exercise reasonable care to avoid causing injury or loss to another person, resulting in liability for any damages caused.

Likely Defence

A plausible argument or strategy used in legal proceedings to refute claims or charges against a defendant.

Standard of Care

A legal benchmark requiring individuals to exercise reasonable care and skill when performing actions that could foreseeably harm others.

Occupier

An individual or group that resides in or takes possession of a particular place or property.