Questions from Advanced Accounting

Q: On December 1, 2017, Ringling Company (a U.

On December 1, 2017, Ringling Company (a U.S.-based company) entered into a three-month forward contract to purchase 1,000,000 pesos on March 1, 2018. The following U.S. dollar per peso exchange rates...

Q: Assuming that MNC did not enter into a forward contract, how

Assuming that MNC did not enter into a forward contract, how much foreign exchange gain or loss should it report on its 2017 income statement with regard to this transaction? a. $5,000 gain b. $3,000...

Q: Assuming that MNC entered into a forward contract to sell 10 million

Assuming that MNC entered into a forward contract to sell 10 million South Korean won on December 1, 2017, as a fair value hedge of a foreign currency receivable, what is the net impact on its net inc...

Q: On March 1, Pimlico Corporation (a U.S.-

On March 1, Pimlico Corporation (a U.S.-based company) expects to order merchandise from a supplier in Sweden in three months. On March 1, when the spot rate is $0.10 per Swedish krona, Pimlico enters...

Q: Torres Corporation (a U.S.-based company) expects

Torres Corporation (a U.S.-based company) expects to order goods from a foreign supplier at a price of 100,000 pounds, with delivery and payment to be made on September 20. On July 20, Torres purchase...

Q: What was the net impact on Jensen Company’s 2017 income as a

What was the net impact on Jensen Company’s 2017 income as a result of this fair value hedge of a firm commitment? a. $–0–. b. $680.30 decrease in income. c. $300 increase in income. d. $980.30 increa...

Q: What was the net impact on Jensen Company’s 2018 income as a

What was the net impact on Jensen Company’s 2018 income as a result of this fair value hedge of a firm commitment? a. $–0–. b. $1,319.70 decrease in income. c. $77,980.30 increase in income. d. $78,68...

Q: The following describes a set of arrangements between TecPC Company and a

The following describes a set of arrangements between TecPC Company and a variable interest entity (VIE) as of December 31, 2017. TecPC agrees to design and construct a new research and development (R...

Q: What was the net increase or decrease in cash flow from having

What was the net increase or decrease in cash flow from having purchased the foreign currency option to hedge this exposure to foreign exchange risk? a. $–0–. b. $1,000 increase in cash flow. c. $1,50...

Q: What is the net impact on Micro’s net income for the quarter

What is the net impact on Micro’s net income for the quarter ended June 30, 2017, as a result of this forward contract hedge of a firm commitment? a. $–0–. b. $2,400 increase in net income. c. $4,000...