The recognized methods for consolidating the financial reports of an MNC are
A)short/long term method,current/future method,flexible/inflexible method,and economic/noneconomic method.
B)current/noncurrent method,monetary/nonmonetary method,short/long term method,and current/future method.
C)current/noncurrent method,monetary/nonmonetary method,temporal method,and current rate method.
D)temporal method,current rate method,flexible/inflexible method,and economic/noneconomic method.

Question

Quizplus · Accepted Answer

The recognized methods for consolidating the financial reports of an Multinational Corporation (MNC) are the current/noncurrent method, monetary/nonmonetary method, temporal method, and current rate method. The current/noncurrent method distinguishes between short-term and long-term assets and liabilities, while the monetary/nonmonetary method distinguishes between financial and non-financial items. The temporal method is used to translate the foreign currency financial statements of a foreign subsidiary into the parent company's reporting currency, while the current rate method translates all foreign currency items at the current exchange rate. These methods are considered the most widely recognized and accepted in the accounting world for consolidating MNC financial statements.

The Recognized Methods for Consolidating the Financial Reports of an MNC