A foreign entity is a subsidiary of a Canadian parent company and has always used the presentation currency translation (PCT) method to translate its foreign financial statements on behalf of its parent company. Which one of the following statements is incorrect? Multiple Choice The Canadian dollar will be the functional currency of this company. Changes in exchange rates between the subsidiary's country and the parent's country are not expected to affect the foreign entity's cash flows. Translation adjustments are shown in shareholders' equity as increases or decreases in other comprehensive Income. The Canadian dollar will be the functional currency of this company. Changes in exchange rates between the subsidiary's country and the parent's country are not expected to affect the foreign entity's cash flows. Translation adjustments are shown in shareholders' equity as increases or decreases in other comprehensive income. Translation adjustments are not shown on the income statement