Under FASB ASC 830,Foreign Currency Matters,when the current rate method is used,how are translation adjustments treated in the consolidated financial statements?
A)as gains or losses on the current period consolidated income statement
B)as prior period adjustments to retained earnings of the parent
C)as part of other comprehensive income on the consolidated balance sheet
D)None of the above because the temporal method is not allowed under FASB ASC 830.

Question

Quizplus · Accepted Answer

When the current rate method is used, translation adjustments are included as a part of other comprehensive income on the consolidated balance sheet. These adjustments are not recognized as gains or losses on the current period consolidated income statement nor are they recognized as prior period adjustments to retained earnings of the parent. The temporal method is another method used for translation under FASB ASC 830, but it is not relevant to this question.

Under FASB ASC 830,Foreign Currency Matters,when the Current Rate Method