When Translating the Assets and Liabilities from Functional Currency to Presentation

question 12

Multiple Choice

When translating the assets and liabilities from functional currency to presentation currency,AASB 121 requires that:

• A) the exchange rates at the dates of transaction are used
• B) the exchange rate as at the end of the reporting period is used
• C) an average exchange rate for the year of reporting be used
• D) either a or c can be used

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Definitions:

Competing Products

Goods or services offered by different businesses that seek to satisfy the same customer needs or market demands.

Internal Standard

A benchmark or criterion established within an organization to ensure consistency and quality in its operations or production.

Life-Cycle Costs

The total cost of owning, operating, maintaining, and disposing of a product or system over its life span.

Transactional Costs

Expenses incurred during trading, beyond the price of the goods, including search and information costs, bargaining costs, and enforcement costs.