________ exposure is the potential for accounting-derived changes in owner's equity to occur because of the need to translate foreign currency financial statements into a single reporting currency.
A) Transaction
B) Operating
C) Economic
D) Accounting

Question

Quizplus · Accepted Answer

Accounting exposure is also known as translation exposure, which refers to the potential impact of changes in exchange rates on financial statements of a company that operates in multiple currencies. It occurs because foreign subsidiaries' financial statements are usually reported in their local currency, and the parent company must translate them into a single reporting currency, causing changes in owner's equity due to currency fluctuations.

________ Exposure Is the Potential for Accounting-Derived Changes in Owner's