_____ Under the temporal method of translation, how is the effect of an exchange rate change reported?
A) As a deferred gain or loss in the balance sheet.
B) Currently in the income statement.
C) As a direct adjustment to equity.
D) In the "Other Nonowner Changes in Net Assets" section of the statement of comprehensive income.
E) As an extraordinary item.

Question

Quizplus · Accepted Answer

Under the temporal method, the effect of an exchange rate change is reported currently in the income statement. This method translates monetary assets and liabilities at the current exchange rate, and any resulting gains or losses from exchange rate fluctuations are recognized in the income statement.

_____ Under the Temporal Method of Translation, How Is the Effect