What is one problem in translating retained earnings using either the temporal or current rate method?
A. There is no problem, since both methods use the historic rate method for stockholders’ equity accounts.
B. Dividends are based on an average cost method.
C. Net income is calculated differently, depending upon which method is used.
D. Dividends are based on the current exchange rate under the current rate method, while they are based on historical rates under the temporal method.
Answer:C
What is one problem in translating retained earnings using either the temporal or current rate method?
A. There is no problem, since both methods use the historic rate method for stockholders’ equity accounts. B. Dividends are based on an average cost method. C. Net income is calculated differently, depending upon which method is used. D. Dividends are based on the current exchange rate under the current rate method, while they are based on historical rates under the temporal method.