Hi guys please hellp How the hell does schweser say that realized gains and losses for fixed assets are recognized under the temporal method through depreciation expense? Does anyone know how depreciation expense is adjusted to account for the exchange rate on the day the fixed asset was sold? I’m definately not an accounting whiz but wouldn’t a gain or loss through sale of P,P,E be accounted as somethin else? Any thoughts???
Under temporal method, the depreciation expense will be translated with the historical rate prevailing when the underlying assets were purchased. Therefore, the exchange rate to be applied to the depreciation expenses will be consistently same throughout the asset-holding period. This means depreciation expense is not relevant to any translation gain/loss. Am I right?
Yes ure right Sean, I just think I was thinkin too much about it last night, Lets just depreciate the sucker at the blended historical rate and go from there,