A transaction involving foreign currency will most likely result in gains and losses to the reporting entity if the

Question

Quizplus · Accepted Answer

When a transaction is denominated in a foreign currency and measured in the reporting entity's currency, it will result in gains and losses due to fluctuations in exchange rates between the two currencies. This is because the reporting entity will need to convert the foreign currency into their own currency for reporting purposes. The other choices are not relevant to the determination of gains and losses from foreign currency transactions.

A Transaction Involving Foreign Currency Will Most Likely Result in Gains