The functional currency is the currency of the primary economic environment in which the company operates.

Question

Quizplus · Accepted Answer

The functional currency is indeed defined as the currency of the primary economic environment in which the company operates. This currency is used for measuring and presenting financial information in the company's financial statements, and it reflects the underlying transactions, events, and conditions that affect the company's operations. The choice of functional currency depends on factors such as the currency in which sales are denominated, the currency of the local operating costs, the currency of the functional and financing risks, and the currency in which profits are remitted or reinvested.

The Functional Currency Is the Currency of the Primary Economic