Exchange gains and losses resulting from translating (not re-measuring) foreign currency financial statements into U.S.dollars should be included as a(an)
A)a component of other comprehensive income.
B)extraordinary item in the income statement for the period in which the rate changes.
C)ordinary gain/loss item in the income statement.
D)component of operating income.

Question

Exchange gains and losses resulting from translating (not re-measuring) foreign currency financial statements into U.S.dollars should be included as a(an)
A)​a component of other comprehensive income.
B)​extraordinary item in the income statement for the period in which the rate changes.
C)​ordinary gain/loss item in the income statement.
D)​component of operating income.

Quizplus · Accepted Answer

Exchange gains and losses resulting from translating foreign currency financial statements into U.S. dollars are considered a component of other comprehensive income, as they are not part of the company's normal operating activities. As such, they are reported as a separate item on the income statement and are not included in the calculation of net income.

Exchange Gains and Losses Resulting from Translating (Not Re-Measuring) Foreign