Under U.S. GAAP, what is the proper treatment of unrealized foreign exchange losses?
A. They should be deferred on the Balance Sheet until the cash is paid.
B. They should not be recognized until cash is received to complete the transaction.
C. They should be recorded on the Income Statement in the period the exchange rate changes.
D. They should be deferred on the Balance Sheet until an offsetting foreign exchange gain is realized.
Answer:C
Under U.S. GAAP, what is the proper treatment of unrealized foreign exchange losses?
A. They should be deferred on the Balance Sheet until the cash is paid. B. They should not be recognized until cash is received to complete the transaction. C. They should be recorded on the Income Statement in the period the exchange rate changes. D. They should be deferred on the Balance Sheet until an offsetting foreign exchange gain is realized.