New RBI Grade B 2025 Notification will come Soon! Enroll Here

    Question

    An Indian exporter receives a payment of USD 50,000 when

    the exchange rate is ₹83/USD. At the year-end, the rate drops to ₹80/USD and the amount is still held in the foreign currency account. How is this treated under Ind AS 21?
    A As a capital loss Correct Answer Incorrect Answer
    B As foreign exchange gain Correct Answer Incorrect Answer
    C As notional loss Correct Answer Incorrect Answer
    D As unrealised foreign exchange loss Correct Answer Incorrect Answer

    Solution

    The drop in value results in an unrealised exchange loss, which must be recorded as per Ind AS 21.

    Practice Next