How do you do the accounting for fixed assets purchased in a foreign currency?
When a company purchases fixed assets in a foreign currency, do they value the fixed asset back into the USD amount at the date the asset was acquired or what? The asset is being carried on the foreign subsidiary's books at the amount in Japanese yen. I'm a little confused about this. Can someone provide details, or provide a source where I can find good information on this topic? Thanks.
Public Comments
- well for companies they have to convert into dollars, and then account for the gain/loss for the currency rates
- You just translate the Yen price to USD cost at time of acquisition and it stays at that cost thereafter. You don't revalue foreign currency non-monetary assets. However you still follow the rest of the standards, like perform the impairment test, etc
