When using the current rate method to record foreign subsidiary results, all assets and liabilities are translated at a rate, in effect as of the statement date.

Question

Quizplus · Accepted Answer

Under the current rate method, all assets and liabilities of a foreign subsidiary are translated into the parent company's reporting currency using the exchange rates in effect as of the balance sheet date (statement date), ensuring that the financial statements reflect the most current value in terms of the reporting currency.

When Using the Current Rate Method to Record Foreign Subsidiary