1.) Record the journal entries for the acquisition of the financial instrument in good form and submit this in a Microsoft Excel spreadsheet. (See spreadsheet)
| 11/1/2013 | 12/31/2013 | 1/31/2014 | |||||
Spot Rate | $1.20 | $1.25 | $1.30 | |||||
Forward Rate | $1.23 | $1.26 | $1.30 | |||||
HedgeCo is interested in purchasing 1,000 of Product Z from OverSeas Inc. HedgeCo is very concerned about two issues: 1) that the price of Product Z will change and 2) the exchange rate will make an unfavorable change before the purchase takes place. Select a hedge and explain your selection. Use the exchange rates above to make your journal entry. Select appropriate account names for your journal entry. | ||||||||
Hedge Type | ||||||||
Reasoning for Selection | ||||||||
Journal Entry | Account Name | DR | CR | Decscribe Financial Statement Effect of each account movement | ||||
- 9 years ago
A++ Answer
Purchase the answer to view it
- hedgeco.xlsx