Differences arise in relation to the treatment of which of the following when translating from the local to functional currency as opposed to the functional to presentation currency?
A) Accounts receivable.
B) Cost of goods sold.
C) Depreciation expense.
D) Share capital.

Question

Quizplus · Accepted Answer

Depreciation expense is usually calculated differently in different countries, so when translating from the local currency to the functional currency, differences can arise. However, when translating from the functional currency to the presentation currency, the method of calculating depreciation expense usually remains the same. Accounts receivable, cost of goods sold, and share capital are usually treated consistently across different currencies.

Differences Arise in Relation to the Treatment of Which of the Following