Under accounting standards for private enterprises, what exchange rate is used for non-monetary items carried at fair value?
A)The exchange rate at the date the item was ordered
B)The exchange rate at the date the item was received
C)The exchange rate at the date of payment for the item
D)The exchange rate at the statement of financial position date

Question

Quizplus · Accepted Answer

According to accounting standards for private enterprises, non-monetary items carried at fair value are reported using the exchange rate at the statement of financial position date. This is because the fair value of such items reflects their value in the current market conditions, which are measured at the statement of financial position date. The exchange rates at the date of order, receipt, or payment may not reflect the current market conditions and hence, do not provide an accurate estimate of the fair value of the non-monetary items.

Under Accounting Standards for Private Enterprises, What Exchange Rate Is