Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

On December 1, Year One, a company acquires two three-month financial instruments that qualify as derivatives. Financial instrument A was bought to serve as a fair value hedge. Financial instrument B was bought to serve as a cash flow hedge. By the end of Year One, both of these financial instruments have increased in value by $1,000. How should these gains in value be reported by the company on the Year One financial statements?

a) Both gains are reported within net income.

b) Both gains are reported within accumulated other comprehensive income.

c) The gain on the fair value hedge is reported within net income whereas the gain on the cash flow hedge is reported within accumulated other comprehensive income.

d) The gain on the fair value hedge is reported within accumulated other comprehensive income whereas the gain on the cash flow hedge is reported within net income.

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M947733

Have any Question? 


Related Questions in Accounting Basics

What are the effects on equitiesfinancial statement effect

What are the effects on equities? Financial Statement Effect of Equity Securities Presented below is a situation involving equity securities: An equity security, whose fair value is currently less than cost, is classifie ...

Accounting and regulatory environmenti need someone to

Accounting and Regulatory Environment. I need someone to write a paper for me on accounting and the regulatory environment. The instructions are below on what it is to include. In the wake of the accounting and finance s ...

Westerville company reported the following results from

Westerville Company reported the following results from last year % 2013 operations: Sales $ 1,000,000 Variable expenses 300,000 -------------------------------------- Contribution margin 700,000 Fixed expenses 500,000 - ...

Comprehensive problem 1morgan companys balance sheet at

Comprehensive Problem 1 Morgan Company's balance sheet at December 31, 2016, is presented below. Morgan Company Balance Sheet December 31, 2016 Cash $30,000 Accounts Payable $12,250 Inventory 3050 Interest Payable 300 Pr ...

Internet case-citizen-centric reportingalthough citizens

Internet Case-Citizen-Centric Reporting Although citizens should be concerned about the performance of government, in truth, few citizens typically review the financial information provided by their government. In part, ...

Assignment lasa ipo presentation amp myaccountinglab

Assignment: LASA: IPO Presentation & MyAccountingLab Post-Tests This assignment will consist of two parts. Part I: IPO Presentation: You work for a medium sized privately held electronics firm which is considering transi ...

Accounting assignmentplease include all calculationswork

Accounting Assignment Please include all calculations/work necessary. Please show references and in-text citing where needed. Please answer all questions in full. No plagiarism. For the eActivity, research one publicly t ...

Illustrative question- shane brookson july 1 2015 shane

Illustrative Question- Shane Brooks On July 1, 2015, Shane Brooks established an interior decorating business, Premium Designs. During the month, the following transactions are completed: July  1. Transferred cash from a ...

A tractor acquired on january 4 of the current year at a

A tractor acquired on January 4 of the current year at a cost of $100,000 has an estimated life of 10 years. Assuming that it has a residual value of $10,000, determine the depreciation expense in the current year using ...

How much did you borrow for your house if your monthly

How much did you borrow for your house if your monthly mortgage payment for a 30 year mortgage at 6.65% APR is $1,600?? A $218,080 B $202,503 C $186,926 D $233,658 E $249,235 F $264,812 Shady Rack Inchas a bond outstandi ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro