What are the differences in accounting for a forward contract used as a fair value hedge of (a) a foreign currency denominated asset or liability and (b) a foreign currency firm commitment?
Answer to relevant QuestionsWhat are the differences in accounting for a forward contract used as a cash flow hedge of (a) a foreign currency denominated asset or liability and (b) a forecasted foreign currency transaction?How are changes in the fair value of an option accounted for in a cash flow hedge? In a fair value hedge?What is the net impact on Werner’s net income for the quarter ended March 31, 2011, as a result of this forward contract hedge of a firm commitment?a. $–0–.b. $1,250 increase in net income.c. $1,500 decrease in net ...Benjamin, Inc., operates an export/import business. The company has considerable dealings with companies in the country of Camerrand. The denomination of all transactions with these companies is alaries (AL), the Camerrand ...On August 1, Jackson Corporation (a U.S.-based importer) placed an order to purchase merchandise from a foreign supplier at a price of 200,000 rupees. Jackson will receive and make payment for the merchandise in three months ...
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