LaSalle Ltd

question 20

Multiple Choice

LaSalle Ltd., a Canadian company, has a subsidiary in Brazil that produces a component used in LaSalle's manufacturing. All of the components that the subsidiary produces are sold to LaSalle. The subsidiary also purchases most of the raw materials used in its production from LaSalle. Both companies use the Canadian dollar as their functional currency. Which of the following statements is true?

• A)The current rate method of translation should be used.
• B)Nothing needs to be done with the subsidiary's financial statements prior to consolidation.
• C)The subsidiary's financial statements need to be re-measured in the functional currency prior to consolidation.
• D)The subsidiary is considered to be an extension of the parent company and consolidation is not required.

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Definitions:

Driving Errors

Mistakes made by drivers while operating a vehicle, which can range from perceptual errors to judgment lapses.

Divided Attention

The mental ability to process multiple sources of information simultaneously or switch focus among varying stimuli.

Attention Switching

The process of shifting focus from one task or stimulus to another, which plays a vital role in cognitive flexibility and multitasking abilities.

Automatic Task

A task performed with little or no conscious effort or control, often because it has been practiced to the point of automatization.