No foreign exchange accounting problem arises as long as the transactions are denominated in the firm's domestic currency.

Question

Quizplus · Accepted Answer

This statement is true. When transactions are denominated in a firm's domestic currency, there is no need for foreign exchange accounting, as there is no exchange rate risk or need for currency conversion. However, if transactions are denominated in a foreign currency, foreign exchange accounting may be necessary to account for changes in exchange rates and the impact on the firm's financial statements.

No Foreign Exchange Accounting Problem Arises as Long as the Transactions