Answer: temporal method after restating them for inflation.

## Explanation **US GAAP Requirements for Hyperinflationary Economies:** 1. **Under US GAAP**, when a subsidiary operates in a hyperinflationary economy: - Financial statements must first be **restated for local inflation** using the general price-level index - After inflation adjustment, the **temporal method** is used to translate the financial statements into the parent's reporting currency 2. **Key differences from normal translation:** - **Normal scenario**: Current rate method is typically used for foreign subsidiaries - **Hyperinflationary scenario**: Temporal method is required after inflation restatement 3. **Rationale:** - Hyperinflation distorts the economic reality of financial statements - Inflation restatement preserves the purchasing power of local currency amounts - Temporal method then provides a more meaningful translation into the parent's currency Therefore, Mandel Corp. must use the **temporal method after restating them for inflation**.

Author: LeetQuiz Editorial Team