2A4A.2 A FIRM’S FUNCTIONAL CURRENCY SHOULD BE A. SELECTED ON THE BAS...
89.
CSO: 2A4a
LOS: 2A4a.2
A firm’s functional currency should be
a.
selected on the basis of several economic factors including cash flow, sales price,
and financing indicators.
b.
the currency of the foreign environment in which the firm primarily generates and
expends cash.
c.
selected on the basis of cost-benefit analysis and ease of preparing consolidated
financial statements.
d.
the currency of the parent organization as the firm operates as an extension of the
parent’s operations.