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sir,would like to know why the sale proceed of foreign subsidiary is 195÷€/$1.3? why not using the average rate€/$1.5 to divide? isn’t profit or loss item should use average rate?
Hi,
Sorry, but I’ve not been able to look at the mock tests that have been provided but I’d have thought that if you are receiving cash as part of a disposal then you would use the rate in place at the date the transaction took place to record the sales proceeds.
just because we are using it to work out a gain/loss through profit or loss wouldn’t mean that we use the average rate.
Thanks
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