CFA Practice Question

There are 334 practice questions for this study session.

CFA Practice Question

Which of the following is true regarding translated (current rate method) and local currency ratios?
A. Ratios computed under the temporal method may be different from both the local currency ratios and those computed from translated data.
B. For pure balance sheet and pure income statement ratios, translation using the temporal method maintains local currency relationships.
C. Ratios computed under the all current rate method may be different from both the local currency ratios and those computed from translated data.
Explanation: Ratios computed under the temporal method may be different from both the local currency ratios and those computed from translated data (using current rate method).

User Contributed Comments 3

User Comment
zwer I had A, but how is it different from C?
ThePessimist C is not correct. Translation and "all current rate method" are the same thing, so C is referring to the same thing twice.
Hishy Trickery.
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