Salient economic factors for determining the functional currency include
A)cash flow indicators.
B)sales price indicators.
C)sales market indicators.
D)all of the above

Question

Quizplus · Accepted Answer

All of the above factors (cash flow indicators, sales price indicators, and sales market indicators) are important in determining the functional currency. Cash flow indicators such as operating expenses and income streams can indicate which currency is most closely tied to the company's operations. Sales price indicators, such as the currency in which contracts are written or how prices compare in different currencies, can also provide insight into the appropriate functional currency. Similarly, sales market indicators, such as the currency in which competitors price their products or the currency in which the majority of sales are made, can be helpful in determining the functional currency. Therefore, all of these factors should be considered in determining the functional currency.

Salient Economic Factors for Determining the Functional Currency Include