Question
1. Under the current rate method of translation, monetary items are restated _________________________ and any gain or loss is recorded in ________________. a) at the
1. Under the current rate method of translation, monetary items are restated _________________________ and any gain or loss is recorded in ________________.
a) at the average rate for the year; net income.
b) at the closing rate at the financial statement date; comprehensive income.
c) at the closing rate at the financial statement date; net income.
d) at the spot rate;other comprehensive income.
e) None of the above
2. When translating foreign currency financial statements for a company under the functional currency (temporal) method, which of the following accounts are translated using historical exchange rates?
Notes PayableEquipment
a)YesYes
b)YesNo
c) NoNo
d)NoYes
e) None of the above
3.In preparing consolidated financial statements of a Canadian parent company and a
foreign subsidiary, the foreign subsidiary's functional currency is the currency based upon
a) the country the parent is located.
b) the country the subsidiary is located.
c) the economic market in which the subsidiary operates
d) the country in which the subsidiary maintains its accounting records.
e) None of the above
4. What type of not-for-profit organization may be allowed to use the restricted fund method?
a) Any NFP that has at least one internally restricted fund.
b) Any NFP organization.
c) Any NFP that has a general fund for unrestricted contributions.
d) Any NFP that has at least one externally restricted fund.
e) None of the above
5. In a not-for-profit organization, donated capital assets are recorded at what value?
a) Estimated net realizable value.
b) The donor's net book value.
c) Fair market value.
d) Replacement or reproduction cost.
e) None of the above
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