When the local currency of the foreign subsidiary is the functional currency,a foreign subsidiary's inventory carried at cost would be converted to U.S.dollars by:
A) translation using historical exchange rates.
B) remeasurement using historical exchange rates.
C) remeasurement using the current exchange rate.
D) translation using the current exchange rate.

Question

Quizplus · Accepted Answer

When the local currency is the functional currency, the translation method is used, and inventory is translated using the current exchange rate.

When the Local Currency of the Foreign Subsidiary Is the Functional