Business, 06.05.2020 06:27 kyleescott9525

On June 1, Alexander Corporation sold goods to a foreign customer at a price of 1,050,000 pesos and will receive payment in three months on September 1. On June 1, Alexander acquired an option to sell 1,050,000 pesos in three months at a strike price of $0.063. Relevant exchange rates and option premiums for the peso are as follows: Date Spot Rate Put Option Premium for September 1 (strike price $0.063) June 1 $ 0.063 $ 0.0028 June 30 0.068 0.0022 September 1 0.062 N/A Alexander must close its books and prepare its second-quarter financial statements on June 30. For ACCN7120: please ignore requirements a-1 and a-2 and solve only requirements b1 and b-2. The fair values of the option contract are in the course website under Module 7.

a-1. Assuming that Alexander designates the foreign currency option as a cash flow hedge of a foreign currency receivable, prepare journal entries for these transactions in U. S. dollars.
a-2. What is the impact on net income over the two accounting periods?

Answers: 3

Show answers

Another question on Business

Business, 21.06.2019 19:30

Maker-bot corporation has 10,000 shares of 10%, $90 par value, cumulative preferred stock outstanding since its inception. no dividends were declared in the first two years. if the company pays $400,000 of dividends in the third year, how much will common stockholders receive?

Answers: 2

Answer

Business, 21.06.2019 21:00

Case in point 2.4 attaway airlines, part two back at attaway airlines, the morning meeting ended with no agreement between dan esposito and molly kinnon. in fact, a new issue arose. molly now says that the new accounting system is entitled to the highest priority because the federal government soon will require the reporting of certain types of company-paid health insurance premiums. because the current system will not handle this report, she insists that the entire accounting system is a nondiscretionary project. as you might expect, dan is upset. can part of a project be nondiscretionary? what issues need to be discussed? the committee meets again tomorrow, and the members will look to you, as the it director, for guidance.

Answers: 1

Answer

Business, 22.06.2019 11:40

You are a manager at asda. you have been given the demand data for the past 10 weeks for swim rings for children. you decide to run multiple types of forecasting methods on the data to see which gives you the best forecast. if you were to use exponential smoothing with alpha =.8, what would be your forecast for week 22? (the forecast for week 21 was 1277.) week demand 12 1317 13 1307 14 1261 15 1258 16 1267 17 1256 18 1268 19 1277 20 1277 21 1297

Answers: 3

Answer

Business, 22.06.2019 12:00

Which of the following is one of the advantages primarily associated with a performance appraisal? (a) it protects employees against discrimination on the basis of race. (b) it motivates employees to work on their shortcomings. (c) it encourages employees to play the role of the whistle-blower. (d) it accurately measures the resources of the firm.

Answers: 2

Answer

You know the right answer?

On June 1, Alexander Corporation sold goods to a foreign customer at a price of 1,050,000 pesos and...

Questions

Business, 09.12.2021 05:00

Jermaine and Kesha are married, file a joint tax return, have AGI of $82,500, and have two children. Devona is beginning her freshman year at State Un...