Recording Revenue for Foreign Currency Sales

Company XYZ operates in several countries and engages in transactions denominated in foreign currencies. In preparing its financial statements, XYZ must consider the effects of exchange rate fluctuations on its currency transactions. For a sale denominated in Euros, at what exchange rate should XYZ record the revenue in its financial statements?

It is important to understand that under IAS 21, the exchange rate at which a foreign currency transaction is recorded is determined at the transaction date.