5. When using Para 23 method to translate a foreign subsidiarys financial statements into NZD to consolidate with NZ Parent company, the actual exchange rate on transaction date should be used to translate:

1. Plant measured at cost, but not the related depreciation expense and accumulated depreciation.
2. Plant measured at cost and the related accumulated depreciation, but not the related depreciation expense.
3. Plant measured at cost, the related accumulated depreciation and the related depreciation expense.

1. A New Zealand Parent company has a U.S. Subsidiary. Which one of the following statements is incorrect?

1. The functional currency of the U.S. Subsidiary can be NZD or USD.
2. Functional currency is the currency of the primary economic environment in which the entity operates. correct
3. NZ Parent company can use any currency as its presentation currency. Correct
4. The functional currency of the U.S. Subsidiary is the currency in which the transactions are recorded by the U.S. Subsidiary.