what is the functional currency

Case B

A Korean operation is a wholly-owned subsidiary of an Australian company which regards the

operation as a long-term investment, and thus takes no part in the day to-day decision making of

the operation. The operation purchases parts from various non-related Australian manufacturers

for assembly by Korean labour. The finished product is exported to a number of countries but

Australia is the major market. Consequently, sales prices are determined by competition within

Australia.