Can some one explain with example of USD and INR below two points ( FOR CURRENT RATE METHOD)
IF LC is depreciating , translated mixed ratios with Income in Num and B/S in Denominator will be larger than original ratio
IF LC is Appreciating , translated mixed ratios with Income in Num and B/S in Denominator will be smaller than original ratio
You’re forgetting one key information. Is it temporal or current rate.
The way I solve these questions and never get them wrong… Make up a ratio with actual numbers, and make up some conversion rates: historical, average and current… And depending on deprecation or appreciation, you set the rates accordingly…
Then you do the conversion and you will see which one rises and which one falls.