When Translating the Financial Statements of a Foreign Operation to Presentation

question 10

Multiple Choice

When translating the financial statements of a foreign operation to presentation currency,AASB 121 requires any gain or loss on translation of the accounts to be:

• A) Recognised as a revenue or expense in the income statement.
• B) Transferred to a reserve in the equity section of the balance sheet.
• C) Deferred and amortised over a period of not greater than 20 years.
• D) Written off against the non-monetary assets of the foreign operation with any balance remaining recognised as a revenue or expense in the period.
• E) None of the given answers.

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Definitions:

Slave Traders

Individuals or companies involved in the buying and selling of human beings for the purpose of forced labor, a practice prominent in historical global trade networks.

Silversmiths

Craftspeople specialized in working with silver to create items such as jewelry, utensils, and decorative objects, practicing a blend of artistic design and metalworking skills.

Walking Purchase

An infamous 1737 purchase of Indian land in which Pennsylvanian colonists tricked the Lenni Lanape Indians. The Lanape agreed to cede land equivalent to the distance a man could walk in thirty-six hours, but the colonists marked out an area using a team of runners.

British Imperial System

A system of colonial rule and economic dominance exercised by Britain over its overseas territories from the 16th to the 20th century.