[Solve] Foreign Currency Translation Reserve in Balance Sheet

 Welcome back to our blog today we are going to talk about the foreign currency translation reserve in the balance sheet so if you are learning about accounts then you should read this spot till the end.

What is a Foreign Currency Translation Reserve (FCTR)?

the Foreign Currency Translation Reserve (FCTR) in a balance sheet represents the accumulated unrealized gains or losses arising from translating the financial statements of a foreign subsidiary into the reporting currency of the parent company.

foreign currency translation reserve in balance sheet example

Foreign currency translation reserve (FCTR):

 $30,000 This account represents the cumulative unrealized gains or losses arising from translating the financial statements of a foreign subsidiary into the reporting currency of the parent company.

Particulars	Debit (Dr.)	Credit (Cr.)
Assets
Current Assets
Cash and cash equivalents	$100,000
Accounts receivable (foreign currency)	$57,500
Inventory	$75,000
Total Current Assets	$232,500
Non-Current Assets
Property, plant, and equipment	$200,000
Total Non-Current Assets	$200,000
Total Assets	$432,500
Liabilities
Current Liabilities
Accounts payable	$30,000
Total Current Liabilities	$30,000
Non-Current Liabilities
Long-term debt	$150,000
Total Non-Current Liabilities	$150,000
Total Liabilities	$180,000
Equity
Common stock	$100,000
Retained earnings	$122,500
Foreign currency translation reserve	$30,000
Total Equity	$252,500
Total Liabilities and Equity	$432,500	$432,500

Conclusion

Here in this post, we add all the relevant information about Foreign Currency Translation Reserve in the Balance Sheet and also explain how to show it in the Balance Sheet. We hope this post is helpful in your accounting journey.