CAF-6 · Chapter 4 · Question 5 of 15
A company holds an investment in land in a foreign country, measured at historical cost in the foreign currency. At the reporting date, the company should:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Report the land using the exchange rate at the date of the transaction.
Explanation
Non-monetary items measured at historical cost in a foreign currency are not re-translated at the reporting date; they continue to be reported using the exchange rate at the date of the transaction.
More IAS 21 Foreign Currency Transactions MCQs
- Q7Which of the following is a primary indicator for determining an entity's functional currency?
- Q8When an entity's functional currency changes, the entity shall:
- Q9Presentation currency is defined as:
- Q10If an entity translates its results into a presentation currency that is different from its functional currency, assets and liabilities…
- Q11When translating into a presentation currency, income and expenses are generally translated at: