On October 15, 1999, Gilmore Inc. invested in a derivative designated as a hedge of the fair value of an asset. By December 31, 1999, the fair value of the hedged asset had decreased by $200,000 but the fair value of the derivative had increased by $220,000. The net effect on 1999 earnings would be a $200,000 b. $0 c. $20,000 d. $220,000 Helgeson Corporation had the following transaction in the last quarter of 1999. Which of the transactions is most likely to result in a derivative subject to ASC 815 - Accounting for Derivative Instruments and Hedging Activities? a. Invested in land with the anticipation of an increase in fair value. b. Purchased available-for-sale securities. c. Negotiated a two-year loan with a Swiss bank to take advantage of lower European interest rates. d. Based on a forecasted purchase of cocoa beans, Helgeson bought a futures contract to protect itself from changes in market prices of cocoa beans. On November 1, 1999, Cox Corp. enters into a derivative contract to hedge the forecasted cash flows associated with a future sale of 100,000 bushels (notional amount) of corn. The future sale date is January 11, 2000. The fair value of the derivative contract at December 31, 1999 increased by $15,000 which was the same amount as the decrease in the value of corn. The fair value of the derivative contract increased by an additional $8,000 from January 1 to January 15, which again corresponded to the decrease in the value of the corn. On January 15, 2000, the corn was sold and the derivative was settled. The gains from the derivative should be recognized in 1999 and 2000 as a. b. 1999 Other Comprehensive Income -0- $15,000 $15,000 $23,000 2000 Earnings (Income) -0- $23,000 $8,000 $23,000 c. d