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ABC company is a parent company in the USA has Dollar as its local currency, it has a subsidiary in France has Euro as its local currency and its reporting currency is USD, we know when the subsidiary transacts in a foreign currency, it may make gains or losses e.g. if it sells goods to a Canadian customer for CAD which is to EUR then receives payment of CAD from the customer which is to EUR, it makes a foreign exchange gain of EUR and in reporting currency may be $8, but if it transacts in local currency (EUR) e.g. if it sells goods to a local customer for EUR which is to $ then receives payment of EUR from the customer which is to $, is it gain of $5? because the transaction is not in foreign currency (this situation is found in ERP softwares which it make adjustments by making a special journal entry which only adjusts the dollar amount in this case only the dollar balance of the customer is Debited for $5 and another account is Credited for $5) so what will this "Another Account" be in accounting, since we can't add this $5 to the exchange gain or loss account resulted from transacting in foreign currency.
as it's obvious that $5 will remain in the reporting currency balance of the customer (the EUR balance zeroed out)
Thanks in advance
هل تحتاج لمساعدة في كتابة سيرة ذاتية تحتوي على الكلمات الدلالية التي يبحث عنها أصحاب العمل؟