Under FASB ASC 830, Foreign Currency Matters, What Is the Definition

question 36

Multiple Choice

Under FASB ASC 830, Foreign Currency Matters, what is the definition of "functional currency?"

• A) The primary currency used by the parent company
• B) The currency that minimizes the translation adjustment on the consolidated financial statements
• C) The currency in which the subsidiary does its financial reporting
• D) The primary currency of the foreign entity's operating environment

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Definitions:

Finished Goods

Rephrased: Completed production items that are ready for sale but haven't yet been sold, reflecting a key category of inventory for manufacturers.

Weighted-Average Method

An inventory costing method that assigns the same average cost to all units available for sale, calculated as the total cost of goods divided by the total number of units available.

Equivalent Units

A concept used in cost accounting to represent the partial completion of goods in production, expressed in terms of fully completed units.

Molding Department

A specialized section in a manufacturing facility where raw materials are shaped into components through the molding process.