Examine the Five Following Cases and Determine If the Functional

Examine the five following cases and determine if the functional currency of a U.S. parent's foreign unit is the foreign currency or the U.S. Dollar.
$\begin{array}{|l|l|}\hline \text { Scenario } & \text { Functional Currency is? } \\\hline \text { Receivables and payables denominated in foreign currency are not } & \\\text { usually remitted to parent company. } \\\hline \begin{array}{l}\text { Sales prices are influenced by worldwide competitive conditions and } \\\text { responsive on a short-term basis to exchange rate changes. }\end{array} \\\hline \text { Foreign unit obtains materials primarily from its own country. } & \\\hline \begin{array}{l}\text { The unit's financing is taken care of through ongoing fund transfers by } \\\text { the parent. }\end{array} \\\hline \begin{array}{l}\text { There is a low volume of intercompany transactions and little } \\\text { operational interrelations between the U.S. parent and foreign unit. }\end{array} & \\\hline\end{array}$

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