AP is translated at current rate under temporal method, but if you are just given current liabilities in the B/S, should you use current rate? Guess CA includes AP and other things…
CL includes AP and other things. Use the current rate for CL but not for CA (inventory).
I remember as if there is a sequence for translation. we should be B/S before I/S right? Thanks Niblita.
Well if you are doing temporal you need to work out inventory and COGS off the BS before you can do the I/S. You need to remeasured COGS to get to NI. For all-current it wouldn’t matter.
Why COGS? I thought the important item is retained earnings from remeasurement, which will be used in the I/S to get the plug number for I/S effect…R/E should capture all the effects from items that flow into NI…
ucsbfiji, you are right. thx. You also need to work out fixed assets and acum dep from remeasurement before working on I/S.