Which of the Following Is a Limitation of Using the Temporal

question 1

Multiple Choice

Which of the following is a limitation of using the temporal method for translating foreign currency financial statements?

• A) The translated asset and liability amounts have no meaningful interpretation.
• B) The translation adjustment will usually have a negative impact on income.
• C) Financial ratios after translation will be distorted.
• D) All of the above are limitations of the temporal method.

---

Definitions:

Power Equalization

Efforts or processes to balance power among parties, typically in negotiations or conflicts, to ensure fairness.

Employed

The state of being engaged in work or having a job.

Gain Advantage

The process of obtaining a superior position or achieving benefits over others, often through strategic actions or decisions.

High Visibility

The state of being highly noticeable or exposed to a large audience, often used in the context of public figures or media coverage.