When translating into the functional currency, foreign currency denominated non-monetary assets measured at historical cost must be translated using the:
A) spot rate at end of reporting period.
B) average rate for the reporting period.
C) exchange rate when the historical cost was determined.
D) exchange rate when the historical cost was revalued to fair value.

Question

Quizplus · Accepted Answer

Foreign currency denominated non-monetary assets measured at historical cost should be translated using the exchange rate when the historical cost was determined. This is because historical cost represents the cost at a specific point in time and it should be translated using the exchange rate that was applicable at that specific point in time.

When Translating into the Functional Currency, Foreign Currency Denominated Non-Monetary