Charges in the fair value of the effective portion of a hedging financial instrument are recognized as a part of current earnings of the period for which of the following? Cash Flow Hedge Far Value Hedge a b C d yes no yes no yes yes no no

Charges in the fair value of the effective portion of a hedging financial instrument are recognized as a part of current earnings of the period for which of the following? Cash Flow Hedge Far Value Hedge a b C d yes no yes no yes yes no no

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 34GI

See similar textbooks

Related questions

Q: You have been asked to forecast the additional funds needed (AFN) for Houston, Hargrove, &…

A: AFN equation. AFN = increase in assets - increase in spontaneous liabilities- increase in retained…

Q: you would like to have in 5 years a total of $5000 for a trip knowing that you can invest a simple…

A: formula. Future amount = principal amount + simple interest amount. simple interest =principal *…

Q: Consider long positions on options written on the same underlying stock. Option 1 is a call on 100…

Q: 2. Components of the Cash Flow Model include the following: 1. 2. 3. 4. 5. Initial Investment Annual…

A: In cash flow model of capital budgeting Initial investment outflow and any further annual outflow…

Q: Under ASC Topic 606 for revenue recognition, which of the following factors is not an indicator of…

A: Its Very Important to determine the Principal and agent as recording of revenue by both Principal…

Q: (IRR of an uneven cash flow stream) Microwave Oven Programming, Inc. is considering the construction…

A: Initial Cash outlay is $7.4 million Cash flow at the end of year 1 is $3.3 million Cash flow at the…

Q: 34. When interest rate decreases, the portfolio manager should a. decrease the duration of the bond…

A: Bond portfolio duration is the weighted duration of all the bonds in the portfolio. As interest rate…

Q: Elsa is planning to set-up an education fund for her daughter. She plans to invest $6,600 annually…

A: Future Value of Annuity: The future value of the annuity represents the worth of the recurring…

Q: If you were to make a deposit of $5,000 today in an investment account expected to pay 5% pa.…

A: The question is related to Time Value of money.When interest is calculated on total of previously…

Q: Which of the following statements is true? O As a general rule, management would want to reduce the…

A: Several statements have been given about the average collection period. We have to find the correct…

Q: Assume that time today is Dec. 13, 2022. Determine what is being asked in each problem. 1. Coco…

A: Amortization schedule refers to the amount including the principal and interest payments made for…

Q: A mortgage of $173,000 is to be repaid by making payments of $996 at the end of each month f…

A: Any periodic payment made to repay a loan or accumulate a sum for a specific purpose is regarded as…

Q: You have savings and you have the following alternatives for investing your money: 1. Apple company…

A: We have three investment options. We need to evaluate them by first finding their current value.

Q: You are trying to convince an investor into buying a rental apartment unit that fetches a rent of…

A: Monthly rent, PMT is 10,000 The time period is 30 years Total number of months, "n" are 30×12 = 360…

Q: Financial Market is a marketplace where buyers and sellers trade and negotiate financial assets and…

A: Financial market is acting as a market place where the different businesses are raising capital from…

Q: A zero-coupon characteristics O True O False bond bears a higher interest rate risk than a…

A: Solution:- Interest rate risk means the expected change in bond price due to expected change in…

Q: A capital goods company is considering a major factory investment, half of which is paid today, and…

A: We need to find a one year rate, one year from now. We have the interest rates known.

Q: a. A $1,000 bond has a 7.5 percent coupon and matures after eleven years. If current interest rates…

A: According to bartley guidelines, if question involves multiple sub parts , then 1st sub 3 parts…

Q: A. greater liquidity. B. greater specialization. C. higher correlations with other asset classes.…

A: Alternative investments are those investments that are different from traditional investments in…

Q: A firm has an outstanding bond with a $1,000 par value that is convertible into 50 shares of common…

A: Conversion ratio is the number of shares needs to issued to convert a bond.

Q: A casual employee who is not feeling well due to severe colds has to decide whether to go to work or…

A: The opportunity cost is the cost of the next best option available to a person. When a person has to…

Q: A firm is considering investing in a project that is expected to generate total free cash flows of…

A: The discounted cash flow valuation method is a frequently employed method wherein all the future…

Q: 27. A two year $100 bond pays an annual coupon of 9% and has a current yield to maturity of 5% what…

A: The bond macaulay duration can be calculated as the value of weighted discounted cash flows/current…

Q: 7) A) B) C) D) E) F) An investment was made into account which earned interest that was compounded…

A: Solution:- When an amount is invested somewhere, it earns interest on it. The amount initially…

Q: XYZ Company Ltd has 1,000,000 $1 ordinary shares and 1,000 $100 10% convertible bonds to be issued…

A: Diluted EPS is calculated under the assumption that all potentially dilutive securities (…

Q: Project b npv is incorrect. MIRR is wrong for A and B.

Q: 30 - With reference to the Security Market Line, assume for the current time period the Risk-Free…

A: The Security Market Line (SML) is a graph that shows the relationship between the expected return on…

Q: Case Study: Time value of money Mr. Road has reached his seventieth birthday and is ready to retire.…

A: Investments are very important for an individual's financial journey through which retirement…

Q: Which of the following is NOT true? You might be better off using elimination approach for this…

A: Several statements have been provided about the risk neutral valuation methodologies and their…

Q: Gert needs to borrow $415,000 to purchase a home. He is able to obtain a thirty year mortage with a…

A: Data given: Loan amount = $415,000 N=30 year Rate=3% Monthly payment =? Working Note #1 PV=$415000…

Q: Zero-coupon bonds are issued at prices below face value, and the investor's return comes from the…

A: Concept. Zero coupon bonds. Zero coupon bonds are the bonds that do not pay any interest to its bond…

Q: (Stock repurchase and taxes) The Barryman Drilling Company is planning on repurchasing $1.00 million…

A: Current price of the stock S1 = $10.01 Number of shares to be sold = 2100 Purchase price of the…

Q: A real-estate developer seeks to determine the most economical height for a new office building,…

A: Present worth is computed by calculating and adding present value of cash flows associated with…

Q: same exercis -lying stock

A: Your payoff is either 0 of S -X Where X is the exercise price, and S is the spot price, it is…

Q: A bond with 6 years remaining until maturity is currently trading for 97:50 per 100 of par Not yet…

A: We have a callable bond here that can be called for the first time at the end of year 4. We need to…

Q: te = 4% convertib

A: reflect the risk-free rate as a compounding factor and the dividend as discounting factor. No…

Q: A bond that has a face value of $3,000 and coupon rate of 3.40% payable semi-annually was redeemable…

A: Bond The financial instrument that helps the company to raise funds to meet its financial need and…

Q: en has cash receipts at the end of each month amounting to ₱5,000 with the first being received on…

A: Price / Present Value can be calculated using PV function in excel PV (rate, nper, pmt, [Fv],…

Q: All of the statements below are true of futures contractsexcept that futures contracts: O a. result…

A: Future contract are those contracts to buy or sell commodity or financial instruments at a…

Q: Jay Johnson graduated from Another University 10 years ago and has not yet started to invest for his…

A: 401(k) retirement plan refers to the plan being sponsored by an employer for allowing eligible…

Q: I need it solved with the data in my question. Thanks

A: With the probability based case, the expected NPV is the weighted average of the NPV of different…

Q: interest rate for an annuity Personal Finance Problem Anna Waldheim was seriously injured in an…

Q: Sara is currently holding 75 shares of Apple, Inc. (AAPL), 16 shares of PayPal (PYPL), and 62 shares…

A: Sara is currently holding 75 shares of Apple, Inc. (AAPL), 16 shares of PayPal (PYPL), and 62 shares…

Q: What would happen to the values of the 12%, 15%, and 7% coupon bonds over time if the required…

A: Price of bond depends on coupon rate and yield to maturity of bond and change with change in…

Q: B 1. You want to buy a condo in Toronto that costs $813,800 and have accumulated a 10.00% down…

A: Mortgage Loan: A loan happens when one or more people, companies, or other entities lend money to…

Q: Question 2 (Consumption Capital Asset Pricing Model (CCAPM)) In the theory of CCAPM, aggregate…

A: The consumption capital asset pricing model (CCAPM) is an extension of the capital asset pricing…

Q: Which one of the following would most accurately characterize Ben Bernanke's attitude toward the…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: A firm has a net profit/pre-tax profit ratio of 0.60, a leverage ratio of 2.0, a pre-tax profit/EBIT…

A: Dupont equation is used to determine the return and it decomposes the return into the three…

Q: Your client has the following goals: to totally remove the value of certain assets from her gross…

A: Given - totally remove the value of certain assets from her gross estate - to receive a stream of…

Question

Charges in the fair value of the effective portion of a hedging financial instrument are recognized as a part of current
earnings of the period for which of the following?
Cash Flow Hedge
Far Value Hedge
a
b
с
d
yes
no
yes
no
yes
yes
no
no

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

How is the impact of uncertainty reflected in a discounted cash flow (DCF) analysis?a) Debt/equity mixb) Discount ratec) Income tax rated) Interest coverage ratio
Which of the following is an example of long term instruments? (select all that apply) a. Asset backed securities b. Commercial paper С. Repo d. Treasury bill
How is the adjustment to fair value recorded differently for a cash flow hedge versus a fair value hedge? That is, how does the fair value adjustment of each type of hedge affect current period net income and the accounting equation?
What is the effective interest rate of a bond or other debt instrument measured at amortized cost? Select the correct response: The interest rate currently charged by the entity or by others for similar debt instruments (i.e., similar remaining maturity, cash flow pattern, currency, credit risk, collateral, and interest basis). The interest rate that exactly discounts estimated future cash payments or receipts through the expected life of the debt instrument or, when appropriate, a shorter period to the net carrying amount of the instrument. The basic, risk-free interest rate that is derived from observable government bond prices The stated coupon rate of the debt instrument.
Accounting type Question: Securities premium reserve account is shown on the liabilities side in the balance sheet under the heading A. Reserves and surplus B. Current liabilities and provisions C. Share capital D. All of these
Which of the following is an idicator of financial risk ? a) Net Sales / Total Assets b) Total Liabilities / Equity c) Return on Assets d) Return on Equity
QUESTION Briefly differentiate between money market and capital market in relation to: i. risk levels ii. timeline for maturity iii. aim of raising money iv. funds supplier v. financial instruments vi. terms of the securities traded vii. investment objective viii. examples (just mention them)
These are ways in which depository financial institutions measure liquidity risk except: a. Liquid assets to total assets. b. Liquid assets to long term liabilities. c. Maturity gap analysis return. d. Net liquidity statement.
type of liabilities: Trade and other payables defination ? Accrued mark-up defination ? Current maturity of long term financing defination ? Short term borrowings defination ? Unclaimed dividend defination ?
For which of the following securities will unrealized holding gains or losses be recorded as other comprehensive income? Enter 1, 2, 3, or 4 that represents the correct answer. Debt investments, trading. Debt investments, held-to-maturity. Equity investments, trading. Equity investments, available-for-sale.
The application of the present value factors in the computation of carrying amounts of bonds payable is a representation of what accounting principle? Conservatism Matching Principle Time Value of Money Materiality