13. Which of the following is true of a firm commitment? The agreement specifies all significant terms. The agreement includes a disincentive for nonperformance that is sufficiently large to make performance probable. Neither of the above is true. Both A and B above are true. A) B) C) D) 14. A futures contract A) is not similar to a forward contract for accounting purposes. is not traded on an organized exchange. B) C) is traded on an organized exchange. None of the above are true. D) 15. Assume that our company incurs a Euro-denominated payable when the exchange rate is S1.20: 1 and that the SUS weakens to S1.27:1 before the payable is paid: A) Our company will not recognize the gain until the payable is paid. B) Our company will not recognize the loss until the payable is paid. C) Our company will recognize the gain on its next statement date. D) Our company will recognize the loss on its next statement date. 16. Net settlement means that neither party is required to deliver an asset. one or both parties are required to deliver an asset. both parties are required to deliver an asset. None of the above A) B) C) D) 17. Which of the following best describes the effects of foreign currency fluctuations on the financial statements of companies with foreign currency-denominated assets and liabilities? A) Fluctuations in the SUS value of foreign currency-denominated assets and B) Fluctuations in the SUS value of foreign currency-denominated assets and C) Fluctuations in the SUS value of foreign currency-denominated assets and D) None of the above liabilities affect both the balance sheet and the income statement. liabilities affct only the balance sheet and have no effect in net income. liabilities affect only stockholders' equity and do not affect the income statement directly