Which of the Following Suggests That the Foreign Entity's Functional

question 48

Multiple Choice

Which of the following suggests that the foreign entity's functional currency is the parent's currency?

• A)​Intercompany transaction volume is low.
• B)​Debt is serviced through local operations.
• C)​There is an active and primarily local market.
• D)​Sale prices are influenced by international factors.

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Definitions:

Exempt

To be free from an obligation, duty, or liability to which others may be subject; typically used in contexts like taxes, legal requirements, or regulations.

Redemption

The buying back of one’s property after it has been sold. The right to redeem property sold under an order or decree of court is purely a privilege conferred by, and does not exist independently of, statute.

Collateral

An asset that a borrower offers to a lender as security for a loan, which can be seized if the loan is not repaid.

Bankruptcy Petition

A formal request filed by an individual or entity seeking the protection of bankruptcy laws to resolve insolvency issues.