Under FASB ASC 830, Foreign Currency Matters, when the temporal 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

Translation adjustments resulting from the application of the temporal method under FASB ASC 830 are reported as gains or losses in the consolidated income statement of the current period. This method translates monetary assets and liabilities at the current exchange rate, while non-monetary items are translated at historical rates. The resulting gains or losses from these translations are recognized in the income statement, affecting net income.

Under FASB ASC 830, Foreign Currency Matters, When the Temporal