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Discuss why the Foreign Currency Translation Adjustment account was negative for GE in two of the three fiscal years. Are the changes in this account reported on the income statement or in the statement of cash flow for GE? Why or why not? Why are changes in a company’s “other comprehensive income” not subject to income taxation?

Discuss why the Foreign Currency Translation Adjustment account was negative for GE in two of the three fiscal years. Are the changes in this account reported on the income statement or in the statement of cash flow for GE? Why or why not? Why are changes in a company’s “other comprehensive income” not subject to income taxation?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Discuss why the Foreign Currency Translation Adjustment account was negative for GE in two of the three fiscal years. Are the changes in this account reported on the income statement or in the statement of cash flow for GE? Why or why not? Why are changes in a company’s “other comprehensive income” not subject to income taxation?

Interpreting the Foreign Currency Translation Adjustment Account. The following information is taken from the annual report of General Electric Co.: Other Comprehensive Income (in millions) 2018 2017 2016 Foreign currency translation adjustment account... $(1,664) $2,178 $(1,298) Discuss why the Foreign Currency Translation Adjustment account was negative for GE in two of the three fis- cal years. Are the changes in this account reported on the income statement or in the statement of cash flow for GE? Why or why not? Why are changes in a company's "other comprehensive income" not subject to income taxation?
Transcribed Image Text:Interpreting the Foreign Currency Translation Adjustment Account. The following information is taken from the annual report of General Electric Co.: Other Comprehensive Income (in millions) 2018 2017 2016 Foreign currency translation adjustment account... $(1,664) $2,178 $(1,298) Discuss why the Foreign Currency Translation Adjustment account was negative for GE in two of the three fis- cal years. Are the changes in this account reported on the income statement or in the statement of cash flow for GE? Why or why not? Why are changes in a company's "other comprehensive income" not subject to income taxation?
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