Which of the following is NOT an economic indicator used by FASB for determining a subsidiary's functional currency?

The basic advantage of the …….. method of foreign currency translation is that foreign nonmonetary assets are carried at their original cost in the parent's consolidated statement while the most important advantage of the ……… method is that the gain or loss from translation does not pass through the income statement.

A foreign subsidiary's ………currency is the currency used in the firm's day-to-day operations.

Translation exposure measures

A/an …….subsidiary is one in which the firm operates as an extension of the parent company with cash flows highly interrelated with the parent.

……. exposure is the potential for an increase or decrease in the parent company's net worth and reported net income caused by a change in exchange rates since the last transaction.

Generally speaking, translation methods by country define the translation process as a function of what two factors?

The biggest advantage of the current rate method of reporting translation adjustments is the fact that the gain or loss goes directly to the reserve account on the consolidated balance sheet and does not pass through the consolidated income statement.