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

Healthcare Finance, I am trying to make a payment and I can''t seem to get ...

I am trying to make a payment and I can''t seem to get it to go throught on you all site..

Explain how management goals are incorporated into pro forma, Explain how m...

Explain how management goals are incorporated into pro forma financial statements. Management locates a target goal, and forecasters produce pro forma financial statements within

Profitability ratios, Profitability Ratios   Profit Margin  ...

Profitability Ratios   Profit Margin  It is a measure of the profit margin of the company. This is important to gauge the financial position of the company.

Principle of leverage, Leveraging can be described as an investing pr...

Leveraging can be described as an investing principle where funds are borrowed to invest in a part of the securities. The manager hopes to earn a return that is g

Financial algebra, can you help me subtract checks and balances in financia...

can you help me subtract checks and balances in financial algebra

Hedging strategy, Crown Co. is expecting to receive 100,000 British pounds ...

Crown Co. is expecting to receive 100,000 British pounds in one year. Crown expects the spot rate of British pound to be $1.49 in a year, so it decides to avoid exchange rate risk

What is usual approach of capital structure, Q. What is usual Approach of c...

Q. What is usual Approach of capital Structure? Ans. Traditional Approach: - The traditional approach establishes middle among the Net Income approach and the Net Operating Inc

Evolution of securitization, Securitization is a financial innovati...

Securitization is a financial innovation born out of the necessity the savings and loan associations of the United States of America face to save themselves from im

Type of assets, type of assets for ppt from t.y.bom com student in commerce...

type of assets for ppt from t.y.bom com student in commerce department in financial management

Theories of the term structure, There are two important term structur...

There are two important term structure theories related to the shapes of the yield curve. First is the Expectations Theory and the second is Market Segmentations

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