Question

Compare the current-rate method of currency translation with the temporal method.?

Compare the current-rate method of currency translation with the temporal method.?

Homework Answers

Answer #1

Basically the Current rate method of the currency translation differs form the historical temporal method of currency translatgion in assest and liabilities are translated at the current exchanghe rates which unlike temporal method . This creates a high risk in currency tranbslation because the current exchange rate can changed whereas the temporal method converts the foreign subsidiary currency in the parent company currency and this method is used when the domestic currency is not as same as the parent company currency .

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