Question 5

You are reviewing your client's Multi currency company Balance Sheet, and the balance as of the previous fiscal year-end for their Canadian bank account, which they closed last year, is a $10 debit balance in US dollars (the home currency). However, the Canadian dollar balance correctly indicates the account has been closed.

Why would this be the case?

(Select all that apply)

• You have to create a journal entry debiting foreign exchange gain or loss $10 and crediting the Canadian bank account $10.
• The Canadian bank account has not been reconciled as of the last fiscal year.
• The Balance Sheet shows the cumulative balance of the account in the home currency based on the home currency value of each of the transactions using the exchange rate that appears on each screen.
• You have to perform a home currency adjustment for the Canadian bank account as of the current date.
• You have to perform a home currency adjustment for the Canadian bank account as of the last fiscal year.