Advanced Accounting
14th Edition
ISBN: 9781260247824
Author: Joe Ben Hoyle, Thomas F. Schaefer, Timothy S. Doupnik
Publisher: RENT MCG
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Question
Chapter 10, Problem 17P
To determine
Identify the appropriate answer for the given statement from the given choices.
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Students have asked these similar questions
In accordance with U.S. generally accepted accounting principles, which translation combination is appropriate for a foreign operation whose functional currency is the U.S. dollar? Choose the correct option.
Method
Treatmemt of transition adjustment
a.
Current rate
other comprehensive income
b.
Current rate
Gain or loss in net income
c.
Temporal
other comprehensive income
d.
Temporal
Gain or loss in net income
In accordance with U.S. generally accepted accounting principles, which translation combination is appropriate for a foreign operation whose functional currency is the U.S. dollar?
Exchange differences arising from the translation of financial statements
of a foreign operation shall be accounted for as: (using the temporal
method)
Translation gain or loss as component of other comprehensive income
Translation gain or loss as component of profit or loss
As valuation adjustment on the company's retained earnings
Netted to the balance of foreign exchange gain or loss
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Similar questions
- Forex difference arising from translating foreign currency denominated transactions to functional currency shall be recognized in Group of answer choices Other comprehensive income with classification adjustment Other comprehensive income without reclassification adjustment Retained earnings Profit and lossarrow_forwardThe translation (remeasurement) adjustment reported in a translation when the functional currency is not the foreign currency is included a. as a separate component of other comprehensive income b. in the current liability section of the balance sheet as deferred revenue c. in the calculation of net income d. none of the abovearrow_forwardExchange difference arising from the translation of financial statements of a foreign operation into the presentation currency of the reporting entity shall be accounted for as Group of answer choices Translation gain or loss as a component of profit or loss Transaction gain or loss as component of other comprehensive income Translation gain or loss as a component of other comprehensive income Transaction gain or loss as component of profit or lossarrow_forward
- Profit on exchange differences, arising on transaction of foreign operations are classified as: a. Operating income b. Other comprehensive income c. Investment income d. Interest incomearrow_forwardExplain the following a) Gain or losses on foreign exchange translations. b )Recording of previous periods errors in revenue and expenditure after preparation of final accounts in the current periods.arrow_forwardWhich translation method results in a set of financial statements as if the foreign subsidiary’s transactions were carried out in US dollars? Current rate method Temporal methodarrow_forward
- In which of the following cases in a translation adjustment necessary? Notes to financial statements are converted from one currency to another Preparation of consolidated financial statements Hedging of foreign currency Foreign currency financial statements are converted to another currencyarrow_forwardAssuming that the functional currency of a foreign subsidiary is the local currency, which of the following accounts would be translated at the current rate on the Balance Sheet date (B/S Rate)? a.Additional Paid-In Capital b.Cost of Goods Sold c.Retained Earnings d.Allowance for Doubtful Accountsarrow_forwardThe components of other comprehensive income include:a. Changes in revaluation surplusb. Remeasurements of defined benefit plansc. Gains and losses arising from translating the financial statements of a foreign operationd. All of thesearrow_forward
- which shall be recognized for each item when foreign currency gain or loss that arises from translation of foreign currency denominated transaction to functional currency? a. inventiry b. interest expense c. accounts receivable d. unearned revenuearrow_forwardDescribe the following: 1)Recording of previous periods errors in revenue and expenditure after preparation of final accounts in the current periods. 2)Gain or losses on foreign exchange translations.arrow_forwardWhich of the following is not a part of Other Comprehensive Income? Group of answer choices foreign currency translation adjustments gains on the sale of equipment unrealized gains on available-for-sale debt securities unrecognized pension costsarrow_forward
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