A Translation Adjustment May Be Necessary When

question 37

Multiple Choice

A translation adjustment may be necessary when:

• A) notes to financial statements are converted from one language to another.
• B) foreign currency financial statements are converted to another currency.
• C) purchasing goods from a domestic company.
• D) hedging foreign currency.

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Definitions:

Resource Prices

Refers to the costs associated with inputs used in the production of goods or services, such as raw materials, labor, and capital.

Market Demand

The total quantity of a product or service that all consumers in a market are willing and able to purchase at various prices.

Increases

This term refers to a situation where a quantity or quality of something goes up or becomes more.

Constant-Cost Industry

An industry where the costs of production do not change as the overall level of production increases or decreases.