The Functional Currency Approach Adopted by FASB 52 Requires

question 42

Multiple Choice

The functional currency approach adopted by FASB 52 requires:

• A)​separate statements be maintained by the domestic parent company and the foreign branch both in their own currencies
• B)​separate statements be maintained by the domestic parent company and the foreign branch with the foreign branch translated into the functional currency
• C)​results from foreign currency changes to be ignored
• D)​a focus on whether the domestic reporting entity's cash flows will be indirectly or directly affected by changes in the exchange rates of the foreign entity's currency

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