As prescribed in AASB 121,when re-measuring financial statements of foreign operations to functional currency,which of the following identifies all items to be re-measured at historic rates?
A) Cash, inventory and accounts receivable;
B) Payables, long-term loan and unearned revenue;
C) Inventory, goodwill, property plant and equipment;
D) Accounts receivable, accounts payable and accrued expenses;
E) None of the given answers

Question

Quizplus · Accepted Answer

AASB 121 requires that all items in the financial statements of foreign operations, except for certain exceptions such as equity items, be re-measured at the closing rate for the reporting period. However, items such as inventory, property plant and equipment, and goodwill are to be re-measured at historic rates instead. Therefore, choice C (inventory, goodwill, property plant and equipment) is the best answer.

As Prescribed in AASB 121,when Re-Measuring Financial Statements of Foreign