According to FASB ASC 830, Foreign Currency Matters, which of the following conditions would indicate that a foreign subsidiary’s functional currency is the parent company’s currency?
A. active local sales market
B. sales price not affected by changes in exchange rate in the short run
C. high volume of intercompany transactions
D. All of the above are indicators that the functional currency is the parent company’s currency.
Answer:C
According to FASB ASC 830, Foreign Currency Matters, which of the following conditions would indicate that a foreign subsidiary’s functional currency is the parent company’s currency?
A. active local sales market B. sales price not affected by changes in exchange rate in the short run C. high volume of intercompany transactions D. All of the above are indicators that the functional currency is the parent company’s currency.