Average exchange rates are used to translate certain items from foreign income statements into U.S. dollars. Such averages are used to: a. Avoid using different exchange rates for some revenue and expense accounts b. Smooth out large exchange gains and losses c. Eliminate large and temporary fluctuations in exchange rates that may reverse in the near future d. Approximate the effects of using the current exchange rates in effect on the transaction dates

Average exchange rates are used to translate certain items from foreign income statements into U.S. dollars. Such averages are used to: a. Avoid using different exchange rates for some revenue and expense accounts b. Smooth out large exchange gains and losses c. Eliminate large and temporary fluctuations in exchange rates that may reverse in the near future d. Approximate the effects of using the current exchange rates in effect on the transaction dates

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Average exchange rates are used to translate certain items from foreign income statements into U.S. dollars. Such averages are used to:

a. Avoid using different exchange rates for some revenue and expense accounts

b. Smooth out large exchange gains and losses

c. Eliminate large and temporary fluctuations in exchange rates that may reverse in the near future

d. Approximate the effects of using the current exchange rates in effect on the transaction dates

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