CFA Practice Question

There are 334 practice questions for this study session.

CFA Practice Question

How are foreign currency translation adjustments resulting from translating foreign currency financial statements to U.S. dollars currently reported?

A. Displayed as an ordinary item in the income statement for the accounting period in which the exchange rate changes.
B. Displayed as an extraordinary item in the income statement for the period in which the exchange rate changes.
C. Displayed in the stockholders' equity section of the balance sheet.
D. Displayed as an ordinary item in the income statement for losses, but deferred in the balance sheet for gains.
E. Displayed in none of the foregoing ways.
Correct Answer: C

User Contributed Comments 3

User Comment
tkorchmaros 'translation' means 'all-current-method' and therefore translation gains/losses are flow into the cumulative translation adjustment account in stockholder's equity.
niti i think so..
bananabun2 yes, the process of "remeasurement" is when we use the temporal method
You need to log in first to add your comment.