Accounting principles for marketable securities and derivations. For each of the items a to d below describe its accounting using one of the following four systems, assuming that the firm does not elect the fair value option:
(1) Measured at fair value with changes recognized in net income.
(2) Measured at amortized cost.
(3) Measured at lair value with changes recognized initially in other comprehensive income.
(4) Measurement depends on whether firm uses hedge accounting.
a. A derivative judged to be effective used to hedge forecasted sales.
b. Derivatives appearing as liabilities; these derivatives do not hedge assets or liabilities or forecasted transactions.
c. Traded debt issued by others that the firm has purchased with the ability to hold to maturity, but the intent after the current year is uncertain. The firm frequently buys and sells debt of this sort.
d. Marketable equity securities held for an indefinite period as securities available for sale.