Which of the following arrangement does not satisfy the defintion of a firm commitment but maysatisfy the definition of a forecasted transaction and therefore may qualify for cash flow hedgeaccounting.a. Budgeted purchases or sales of products at market termsb. A commodity purchase agreement that provides for a fixed quantity to be delivered at a fixedprice with specified timingC. A contract for the purchase of equipment on a specified delivery date at a fixed pricedenominated in a foreign currency (In this case, the exchange rate is not fixed, but the foreigncurrency amount is.)d. A license or royalty agreement that provides for fixed periodic payments at specific time intervals

The forecast may also be done about the cash balance in hand the organization forecasts to keep and…

Answered: Which of th

Business

Accounting

Which of th

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

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 4C: One of the more difficult issues that companies face in recognizing revenue is determining the...

See similar textbooks

Related questions

Q: Cash Receipts Budget and Accounts Receivable Aging Schedule Shalimar Company manufactures and sells…

A: Cash receipt budget means the statement showing the expected cash receipts for the future period. It…

Q: 4. If a higher ROE is desirable, why don't companies take on large amounts of debt? a. Additional…

A: Ans. A company's financial structure consists of debt and equity. Debt has to be repaid while equity…

Q: A and B are partners in AB Partnership sharing profits and losses 25% and 75%, respectively. On…

A: The partnership may revalue assets if the evaluation increases the value of the asset, it will be a…

Q: Sergei Company purchases land for $4,000,000 from which it expects to extract 2,000,000 tons of…

A: Depletion expense is the cost that is charged against the profits for the use of natural resources.…

Q: 1a. On May 1$t, 2015, Nancy Silva paid $870,000 for a commercial building. She later sold the…

A: MACRS is the modified accelerated cost recovery system. There is two depreciation system in MACRS,…

Q: Provide the missing data in the following table for a distributor of martial arts products: (Round…

A: Formula: Margin = Net operating income / Sales Turnover = Sales / Average operating assets ROI = Net…

Q: Bell & Porter has the following average times (in hours). 1.60 Inspecting product Manufacturing…

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

Q: The School of Accounting (SOA) at State University is planning its annual fundraising campaign for…

A: 1. The School of Accounting (SOA) Direct Labor Budget In Hours Minutes for wrong numbers 1800…

Q: Winsor Clothing Store had a balance in the Accounts Receivable account of $760,000 at the beginning…

A: Solution:- Given, Winsor Clothing Store had a balance in the Accounts Receivable account at…

Q: QUESTION 9 If you invest $5100 per year in a stock that grows at rate of 6% per year, how much will…

A: Time value of money means the worth of money today is more than the value of money in the future.

Q: Given the information in Exhibit 11.2, calculate the bank's dity sources to liquidity needs. Is…

A: Liquidity sources refer to the mediums of generating money or liquid cash such as cash or cash…

Q: Using the Adjusted Trial Balance shown below, prepare an Income Statement Using the Adjusted Trial…

A: Retained earning means the amount left in business after paying all expenses and dividend to…

Q: sold at a constant mark-up of 25% and the entity uses the periodic inventory system. AFRICA…

A: The answer has been mentioned below.

Q: Waterways Corporation is preparing its budget for the coming year, 2020. The first step is to plan…

A: The budgets are prepared to estimate the budgeted sales, budgeted production Units and budgeted…

Q: Juliet Company is in the business for leasing new sophisticated equipment. As lessor, Juliet Company…

A: Following information are summarized for calculation of required information: Commencement of lease…

Q: Joyner Company’s income statement for Year 2 follows: Sales $ 705,000 Cost of goods sold 92,000…

A: Statement of cash flows forms a part of financial statement of the entity and is prepared with a…

Q: On January 1, 20x1, Pitchfork Company issued a $750,000, 8%, 5-year bond for $860,401 and incurred…

A: GIVEN On January 1, 20x1, Pitchfork Company issued a $750,000, 8%, 5-year bond for $860,401 and…

Q: 8. An entity, Dominic Limited has profit after tax of $15 million for the year ended December 31,…

Q: Cost of Goods Sold Budget Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic…

A: Total budgeted manufacturing cost=Budgeted direct materials+Budgeted direct labor+Budgeted overhead

Q: -) Monthly payment: S_] (Round to tal interest paid: S (Round to two

A: Compound interest is used in case of lump-sum money accumulates in the future if interest is charged…

Q: Chart of Accounts Assets Owner's Equity 301 J. David, Capital 302 J. David, Drawing 303 Income and…

A: Journal Entries - Journal Entries are the recording of transactions of the organization. It is…

Q: on is considering a capital investment of $50,000. The equipment has a projected e two-year project…

A: The taxable income is the income available before tax but after deductions of all expenses that have…

Q: Oldham Incorporated conducts business in State M and State N, which both use the UDITPA three-factor…

A: Apportionment percentage - State M: Sales factor = $3,000/$10,500 = 0.2857 = 28.57% Payroll…

Q: ent pa

A: Brief Leas Accounting

Q: A Kubota tractor acquired on January 8 at a cost of $36,000 has an estimated useful life of 10…

A: Introduction: Depreciation: Decreasing value of fixed assets over its useful life period called as…

Q: A 50-y

A: The taxable total income of the individual taxpayer includes the income earned by the respective…

Q: The Lessor is Supreme Asset Management Company (SAMC) and the lessee is Bogue Distributors Limited…

A: Financial lease - Lease Accounting

Q: rdinary shares with P50 par value for a combined cash amount of P11,000,000. The market value of the…

A: Shareholders also invest money in the company and in return they become the owners in proportion to…

Q: 7. Responsibility Accounting: a. What is a cost center? Give an example of a cost center b. What is…

A: Disclaimer: “Since you have posted a question with multiple sub-parts, we will solve first three…

Q: Survive, Inc.’s property, plant and equipment at December 31, 2019: P R T C Original cost P175,000…

A: Depreciation is the reduction in the number of assets due to normal wear and tear and obsolescence.…

Q: On May 1st, 2015, Nancy Silva paid $870,000 for a commercial building. She later sold the building…

Q: On 1 July 2021, Sydney Ltd issued a prospectus inviting applications for 400,000 ordinary shares, at…

A: Shareholder equity means the amount that belong to the owner of the company i.e. share holder.…

Q: Salamagundi, Inc. has the following Income Statement (in millions): SALAMAGUNDI, INC. Income…

A: Vertical analysis: It is a method of analyzing the financial statement in which each item is shown…

Q: Relative to the above data, how much is the Cost of sales and Net income for the period

A: The cost of goods sold is the cost of purchases and manufacturing of the products which the company…

Q: Carpark Services began operations in 20X1 and mantans investments in avalate or sale debt securtes…

A: A journal entry is being used to record a business arrangement in a corporation's accounting…

Q: The partnership of A and B was formed on January 1, 2021. On this date, A invested PHP200,000 cash…

A: Partnership is one of the agreement between two or more than two persons, in which they invest their…

Q: Home Office collected 100,000 from Branch’s customers on account. Requirements: a. Prepare the…

Q: . Entities may apply a simplified approach when recognizing impairment losses on trade receivables…

A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Q: AB purchased a Central Maine Power Bond for $100,000 (also equaled the face/maturity amount) on…

Q: The Weber Company purchased a mining site for $573,259 on July 1. The company expects to mine ore…

A: For the use of natural resources, depletion expenses is charged (against profits). It is most common…

Q: e 10 mins..i'll upvote

A: Virtually all of currency notes in use are Federal Reserve notes.. The Federal Reserve issues…

Q: Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost…

A: In the flexible budget revenue and net operating are less than actual revenue and net operating…

Q: C Co established a petty cash fund of P40,000. Fund disbursements during the period was P27,363. The…

A: In the given question, total cash disbursements from the petty cash fund during the period was P…

Q: I. Journalize the following transactions that occurred for Jane Long's Restaurant in the month of…

A: The question is related to the Journal entries and posting the same into ledger Accounts.…

Q: Assume that Barb City acquires $2,000 of inventory on May 1, 2022, having held no inventory…

A: Inventory is a type of asset that is sold in company operations. Inventory may not be available for…

Q: Compute the book value of an asset with FC of ₱4 500 000 after 7th year if it has useful life of 13…

A: Introduction: Depreciation: Decreasing value of fixed assets over its useful life period called as…

Q: In October, Pine Company reports 21,000 actual direct labor hours, and it incurs $125,500 of…

A: Standard overhead = Standard hours*Predetermined overhead rate Total overhead variance = Actual…

Q: STI Co. acquired 55% of the outstanding shares of UE Inc on August 1, 2021 at a total cost of…

A: Non Controlling Interest For the calculation of non controlling interest the minority interest which…

Q: Required Prepare a vertical analysis of both the balance sheets and income statements for Year 4 and…

A: The Statement of Comprehensive Income - The statement of comprehensive income is the profit earned…

Q: In preparation for developing its statement of cash flows for the year ended December 31, 2021,…

A: Cash flow from Financing activities includes the transactions relating to the loan/debt,…

Question

Which of the following arrangement does not satisfy the defintion of a firm commitment but may
satisfy the definition of a forecasted transaction and therefore may qualify for cash flow hedge
accounting.
a. Budgeted purchases or sales of products at market terms
b. A commodity purchase agreement that provides for a fixed quantity to be delivered at a fixed
price with specified timing
C. A contract for the purchase of equipment on a specified delivery date at a fixed price
denominated in a foreign currency (In this case, the exchange rate is not fixed, but the foreign
currency amount is.)
d. A license or royalty agreement that provides for fixed periodic payments at specific time intervals

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

Similar questions

One of the more difficult issues that companies face in recognizing revenue is determining the transaction price. In cases where the consideration in a contract includes a variable amount, an entity should estimate the amount of consideration to which it is entitled in exchange for transferring the promised goods or services. Required: Discuss the methods a company may use to estimate variable consideration and the situations in which one method may he preferred over another.
Suppose a firm makes the following policy changes listed. If a change means that external, nonspontaneous financial requirements (AFN) will increase, indicate this by a (+); indicate a decrease by a (−); and indicate no effect or an indeterminate effect by a (0). Think in terms of the immediate effect on funds requirements.
It is the risk of a possible future change in one or more of a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index or other variable, provided in the case of a non-financial variable that the variable is not specific to a party to the contract. Insurance risk Financial risk Operating risk Credit risk You are a business manager. During the period, you have authorized the acquisition of a machine that will be used in your company’s manufacturing activities in the next 5 years. In your selection of an appropriate accounting policy for the recognition and measurement of the machine, which of the following reporting standards is most relevant? PAS 1 PAS 2 PAS 16 PAS 32 Under current standards, a subsequent expenditure on an item of property, plant and equipment is most likely to be capitalized to the asset account. debited to the related accumulated…
Which of the following-would beconsistent with a more aggressiveapproach to financing workingcapital? A. Financing short-term needs with short-term funds.B. Financing seasonal needs with short-term funds.C. Financing some long-term needs with short-term funds.D. Financing permanent inventory buildup with long-term debt.
Is this statement true or false? please explain in detail The Discounted Cash Flow method is the one of best ways to assess the impact of a major investment in an alternative production lay out, as the gains efficiency will be counterbalanced by changes in in inventory levels
An analysis of a proposal by the net present value method indicated that the present value of future cash inflows exceeded the amount to be invested. Which of the following statements best describes the results of this analysis? A)The proposal is undesirable, and the rate of return expected from the proposal is less than the minimum rate used for the analysis. B)The proposal is desirable, and the rate of return expected from the proposal exceeds the minimum rate used for the analysis. C)The proposal is undesirable, and the rate of return expected from the proposal exceeds the minimum rate used for the analysis. D)The proposal is desirable, and the rate of return expected from the proposal is less than the minimum rate used for the analysis.
In the discounted cashflow method, the discount rate is used for the following reasons EXCEPTa. it removes the timing differences of cashflows.b. it serves as the required rate of return of the asset being valued.c. it removes the expected riskiness of differing assetsd. it equalizes cash inflows to cash outflows so that the value would equal to the market value.
Following IFRS, which statement is false? Group of answer choices The revaluation surplus account is a specific account reported as an unrealized gain in the statement of comprehensive income. If a long-term operating asset's fair value decreases in subsequent accounting periods, after an earlier write-up, the firm reduces the revaluation surplus if it exists. If the revaluation initially increases the long-term operating asset's carrying value, the firm records the difference between the carrying value and the fair value (the unrealized gain) in the revaluation surplus account. The revaluation surplus account is a specific account reported in other comprehensive income (OCI) in the statement of comprehensive income.
A disadvantage of using the payback period to compare investment alternatives is that it a. Ignores cash flows beyond the payback period. b. Cannot be used to compare alternatives with different initial investments. c. Cannot be used when cash flows are not uniform. d. Involves the time value of money. e. Cannot be used if a company records depreciation.
Which of the following is not a factor that a firm's management take into consideration when deciding on its short-term financing policy? Multiple Choice Short-term versus long-term investment opportunities. Maturities of its assets and liabilities. Behaviour of short-term rates versus long-term rates. Product mix demand. Liquidity needs.
An analysis of a proposal by the net present value method indicates that the present value of future cash inflows is less than the amount to be invested Which of the following statements best describes the results of this analysis ? The proposal is undesirable , and the rate of return expected from the proposal is less than the minimum rate used for the analysis . The proposal is desirable , and the rate of return expected from the proposal is less than the minimum rate used for the analysis The proposal is desirable , and the rate of return expected from the proposal exceeds the minimum rate used for the analysis . The proposal is undesirable , and the rate of return expected from the proposal exceeds the minimum rate used for the analysis .
Which of the following scenario shows the financial manager’s financing function? a. Prioritizing investments based on properly computed capital rationing method. b. Capital budgeting computation and decision with regards to the planned acquisition. c. Assessing and selecting a long-term and short-term financing tools that has a low cost. d. Monitoring trends in operating expenses for the purpose of budget allocation.