Translation process among the monetary/nonmonetary method, Financial Management

Assignment Help:

Explain the distinction in the translation process among the monetary/nonmonetary method and the temporal method.

Answer:  Within the monetary or nonmonetary method, every monetary balance sheet accounts of a foreign subsidiary are transformed at the current exchange rate. Other balance sheet accounts are translated at the historical rate exchange rate effectively while the account was first recorded. Within the temporal method, monetary accounts are translated at the current exchange rate.  Other balance sheet accounts are as well translated at the current rate, if they are accepted on the books at current value.  If they are accepted at historical value, they are translated at the rate in effect on the date the item was put on the books.  Because fixed assets and inventory are generally accepted at historical costs, the temporal method and the monetary/nonmonetary method will usually provide the same translation.


Related Discussions:- Translation process among the monetary/nonmonetary method

Financial analysis project, Financial Analysis Project: At the begi...

Financial Analysis Project: At the beginning of 2009, CanGo purchased the online gaming company. This purchase was for cash, paid for through the proceeds of the

measuring yield spreads, A yield spread between any two bond issues ...

A yield spread between any two bond issues can be easily computed when the maturity date for both these issues is same. The yield spread between these two bond

Role of banks in international trade transactions, Question 1 Internationa...

Question 1 International trade is the economic interaction among different nations involving the exchange of goods and services. Discuss the role of Banks in International Trade T

Cost of capital, The Nu-Nu Brothers Inc. (NNBI) has the following capital s...

The Nu-Nu Brothers Inc. (NNBI) has the following capital structure, which it considers to be optional: Debt 25% Preferred Stock 15% Common Equity 60% NNBI''''s expected net income

Stock valuation, Investors require an 11% return on a preferred stock that ...

Investors require an 11% return on a preferred stock that pays a $2.30 annual dividend.  What is the price

Simple average of the outcomes - time constraint, 1. Your welfare depends o...

1. Your welfare depends on how much time you travel T and how much time you play P and is the product of the two, i.e.,  W = T * P (a) The total amount of time you have is 10 ho

FDD , fimnancial accounting system

fimnancial accounting system

Long-term debt finance, The approaches that Blin could accept regarding the...

The approaches that Blin could accept regarding the relative proportions of long- and short-term finance to meet its working capital needs have been described as moderate, conserva

Explain the financial desirability of burley plc, BURLEY PLC Financial...

BURLEY PLC Financial desirability In a real-terms analysis the real rate of return necessary by shareholders has to be used. This is found as follows 1 nominal rate/1 i

Operational rules for financial management, Operational Rules for Financial...

Operational Rules for Financial Management Besides features, certain operational rules are established as to the subsequent: 1) While revenue and expenses are reported;

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd