CAF-6 · Chapter 4 · Question 6 of 15
Exchange differences arising on the settlement of monetary items should be recognized in:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Profit or Loss
Explanation
Exchange differences arising on the settlement or translation of monetary items at rates different from those at which they were initially recorded are recognized in profit or loss in the period in which they arise.
More IAS 21 Foreign Currency Transactions MCQs
- 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:
- Q12A foreign exchange gain on a non-monetary item (like a revalued building) where the gain itself is recognized in OCI, should have its…