Question: Need help with this! Describe the accounting for forward contracts and options used as cash flow hedges and fair value hedges to hedge foreign currency

Need help with this!

Describe the accounting for forward contracts and options used as cash flow hedges and fair value hedges to hedge foreign currency assets and liabilities, foreign currency firm commitments, and forecasted foreign currency transactions.

According to the Modigliani and Miller theorem, there is no reason to hedge because hedging does not add value to the firm. Is this position valid. Explain.

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