5-Foreign Operations Flashcards
1
Q
Transactional currency
A
Local recording currency
The currency of a particular country
Usually books and records are kept
2
Q
Functional currency
A
Greatest economic impact on company
Currency in which entity generates and expends cash
3
Q
Reporting currency
A
Currency in which the enterprise prepares its financial statements
4
Q
Remeasurement
A
Transactional—functional
Income statement
5
Q
Translation
A
Functional—reporting Balance sheet(OCI)
6
Q
Spot rate
A
Actual exchange rate on a particular date
7
Q
Forward rate
A
Exchange rate expected to be at some point in the future
8
Q
Assets and liabilities are translated at the ____
A
Current exchange rate
9
Q
Income statement items are translated at the
A
Exchange rates effective on the date that those items are recognized on the financial statements
