If the Functional Currency Is Determined to Not Be the Foreign

question 46

Multiple Choice

If the functional currency is determined to not be the foreign entity's local currency, translation is done using

• A)​the current rate method
• B)​the functional method
• C)​the re-measurere-measurement method
• D)​the derivative method

---

Definitions:

GAAP

Generally Accepted Accounting Principles refer to the commonly applied rules and standards in financial reporting and accounting.

GAAP

Generally Accepted Accounting Principles (GAAP) are a set of rules and standards for financial reporting that companies in the U.S. are required to follow to ensure consistency and comparability among financial statements.

IFRS

A collection of accounting standards established by the International Accounting Standards Board, intended for worldwide application, known as International Financial Reporting Standards.

Cash-Basis Accounting

An accounting method where revenues and expenses are recorded when cash is received or paid, as opposed to when they are incurred.