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How are translation gains and losses handled in a different way as per to the current rate method in comparison to the other three techniques, which is the current/noncurrent method, the monetary/nonmonetary technique, and the temporal technique?
Answer: Within the current rate method, translation losses and gains are handled just as an adjustment to net worth by an equity account named the “cumulative translation adjustment” account. Not anything passes throughout the income statement. The another three translation methods pass foreign exchange gains or losses by the income statement before they enter on to the balance sheet by the accumulated retained earnings account.
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