When the Local Currency of the Foreign Subsidiary Is the Functional

question 50

Multiple Choice

When the local currency of the foreign subsidiary is the functional currency,a foreign subsidiary's income statement accounts would be converted to U.S.dollars by:

• A) translation using historical exchange rates.
• B) remeasurement using current exchange rates at the time of statement preparation.
• C) translation using average exchange rate for the period.
• D) remeasurement using the current exchange rate at the time of statement preparation.

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Definitions:

Electron Charge

A fundamental property of the electron indicating the amount of negative electrical charge it carries.

Atom Nucleus

The central core of an atom, containing protons and neutrons, around which electrons orbit.

AC Sinewave

Represents alternating current electricity in a waveform that alternates in a sinusoidal manner, typical of household electrical supply.

Ion

An atom with either an excess or a deficiency of electrons in the valence; a negatively or positively charged particle.