A Foreign Entity Is a Subsidiary of a U

question 5

Multiple Choice

A foreign entity is a subsidiary of a U.S.parent company and has always used the current rate method to translate its foreign financial statements on behalf of its parent company.Which one of the following statements is false?

• A)The U.S.dollar is the functional currency of this company.
• B)Changes in exchange rates between the subsidiary's country and the parent's country are not expected to affect the foreign entity's cash flows.
• C)Translation adjustments are shown in stockholders' equity as increases or decreases in other comprehensive income.
• D)Translation adjustments are not shown on the income statement.

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Definitions:

Quota Sampling

A sampling method where the sample is chosen to reflect certain characteristics of the population in proportion.

Subcultural

Pertaining to a group within a larger culture that differentiates itself from the larger culture through a unique set of beliefs, values, or behaviors.

Deviant Group

A collection of individuals who deviate from societal norms or values, often resulting in societal judgment or sanction.

Complete Participant

A researcher fully participates in the social setting under study without revealing their research intentions.