登录之后可查看解析

Answer (D) is correct . When a foreign entity’s functional currency is the U.S. dollar, the financial statements of the entity recorded in a foreign currency must be remeasured in terms of the U.S. dollar. Revenue received in advance (deferred income) is considered a nonmonetary balance sheet item and is translated at the applicable historical rate (400,000 drongos × $.50 per drongo = $200,000). Deferred charges and credits (except policy acquisition costs for life insurance companies) are also remeasured at historical exchange rates. The deferred tax liability (a deferred credit) should be remeasured at the historical rate (187,500 drongos × $.40 per drongo = $75,000). The total for these liabilities is therefore $275,000 ($200,000 + $75,000).

Answer (A) is incorrect because Applying the year-end rate to the total liabilities results in $205,625.
Answer (B) is incorrect because The historical, not current, rate should be used to remeasure the deferred income.
Answer (C) is incorrect because The historical rate is used to remeasure nonmonetary balance sheet items, including deferred tax assets and liabilities.