What are the different types of future contracts? Explain each.

Q: one key difference between option contracts aND FUTURE CONTRACTS IS THAT IN AN OPTION CONTRACT, THE…

A: Option Contract-An options contract is a contract between two parties to facilitate a potential…

Q: What is a purchase option? How does it affect accounting for a lease?

A: Purchase option : A purchase option is an agreement that gives the lessee a choice to purchase the…

Q: What is the difference between contingent claims (options) and forward

A:

Q: which are the terms and conditions for OPTION CONTRACT WITH SIMULTANEOUS TITLE CLOSING?

A: The option contract is an obligation to purchase the property in the future at a fixed predefined…

Q: What is the effect of the fulfillment of the condition in a conditional obligation? resolutory…

A: A conditional obligation would seem to be one that is contingent on the occurrence of an unknown…

Q: The ability to meet short term obligations is termed

A: A short-term liability is referred to as the financing obligation that being liable to an…

Q: What is the concept of sale-leaseback agreement?

A:

Q: Why would a lease include a contingent payment provision? Explain.

A: Contingency payment provisions is a provision for a possible event or circumstance which is not…

Q: Explain when does a contract meet the definition of a lease?

A: According to IFRS 16 a lease is defined as, "a contract, or part of a contract, that conveys the…

Q: Explain the difference between the forward price and the value of a forward contract. Give an…

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…

Q: Explain how purchase commitments are recorded for the lower of contract price or market price.

A:

Q: payoff for put option buyer and seller?

A: A put option is an instrument which provides its holder an option to sell an underlying asset on a…

Q: Describe the accounting for the fair value option.

A: The fair value option allows the business to record its assets and liabilities at their fair value.…

Q: what is fixed-price contract, and what are the benfit of chosing it

A: A contract where the price is fixed as negotiated by the parties is known as a Fixed Price Contract.…

Q: The present worth of the two contracts is determined to be $

A: Present worth of a contract is the value it possess in current period by considering the discounted…

Q: For what reasons should the percentage-of-completionmethod be used over the completed-contract…

A: Completed contract method: In this method the revenue and profit are recognized only after the…

Q: Which of the following is true about forward contract expiration?  a.A deliverable forward contract…

A: On the date of expiration of a forward contract, settlement can be made on delivery basis or on cash…

Q: a) Calculate the current rate of return of this obligation b) Calculate the Macaulay duration of…

A: Information Provided: Nominal rate = 1% Coupon rate = 107.28%

Q: What are three similarities of a future contract and a forward contract?

A: Forwards are the contract made for the private placements while futures are traded under stock…

Q: What are the types of agreement related to sale-leaseback agreement?

A: Sale and Leaseback Agreement is a kind of financial transaction. This is a situation that arises…

Q: What is the midmonth convention?

A: Depreciation means decline in the estimation of benefit inside its valuable life because of mileage…

Q: in a conditional

A: A conditional obligation would seem to be one that is contingent on the occurrence of an unknown…

Q: Discuss about the long term liability Vs short term liability?

A: SOLUTION- LIABILITY- ANY AMOUNT OR SUM A BUSINESS OR COMPANY IS OBLIGATED TO PAY TO ANY INDIVIDUAL,…

Q: What are the two types of losses that can become evidentin accounting for long-term contracts? What…

A: The two types of losses that can become evident while accounting for long-term contracts are:(1) A…

Q: The major difference between future and option arises from the different obligations of buyers and…

A: The option and future are used to hedge investment as well as to make money and it represents the…

Q: Explain how both the intrinsic value and the time value are measured for a forward contract to sell…

A: SOLUTION:- An option ,represents the right rather than an obligation to buy or sell the security.…

Q: When is a forward contract preferred over an option contract ?

A: Forward contract and Option contract Option contract gives the right to the holder to buy or sell…

Q: What is the Social Contract – its pros and cons

A: The social contract approach to industry refers back to the technique a organization chooses when it…

Q: Is the “forward price” the same thing as the “value of the forward contract” Explain.

A: Derivative is defined as the contract, which are between the two or more parties, who has the value…

Q: What is meant by a term-loan agreement?

A: A Loan Agreement, also known as a term loan, demand loan, or loan contract. It basically is a legal…

Q: What is an option? How does an Option differ from a forward or future contract?

A: Derivative Security: A derivative is financial security whose price and value are determined based…

Q: Can the present value of minimum lease payments differ between the lessor and lessee? If so, how?

A: Leases: Lease is a contractual agreement whereby the right to use an asset for a particular period…

Q: What are the two obligations of postretirement plans?

A: Defined benefit pension plans are the retirement designs that include providing a fixed and…

Q: What is the present worth of a uniform series payment?

A: The present worth is the value of an asset at present considering an assumed discount rate, which…

Q: Define Long-term contract

A: Meaning of Contract: An agreement between two private parties that creates mutual legal obligations.…

Q: What is the future worth of a uniform series payment?

A: The future worth is the value of an asset at a predefined future date which increases at a specific…

Q: characteristics of the contract of pledge?

A: Answer: Contract of pledge can be defined as the contract that is established between the parties…

Q: Which are the terms and condition on CONTRACT FOR FUTURE DEED?

A: Contract for future deed is an agreement which provides for the finance by the seller for the sale…

Q: What if Lease Terms are Modified?

A: Lease terms is a contractual agreement or obligation that is prepared and signed by both lessor and…

Q: What is an Option Contract?

A: An Option contract is an agreement between two parties to buy or sell an underlying asset, at a…

Q: . Which of the following may not be equal to the contract rate of interest? a. stated rate b.…

A: Contract rate of interest is the defined rate of interest on bonds, notes or loan.

Q: Define Forward and Future contract and also differentiate between hedging and Speculation

A: A forward contract is a customisable derivative contract between two parties to buy or sell an asset…

Q: on the date of expiry, the price of an expiring forward or future contract must be equal to the spot…

A: Convergence means the movement of the future price of the contract towards the spot price of the…

Q: What Is Benefits of Long-Term Contracts?

A: Long-term contracts are the contracts which runs over number of years. Long-term contracts are also…

Q: A contract requiring a specified future monetary payment at a specified future point in time in…

A: A derivative is a complicated financial security that is agreed upon by two or more parties. Traders…