Question 7 (Mandatory) (10 points)

Which of the following derivatives can be designated as cashflow hedge only?

Question 7 options:

A)	If Amerco enters into a forward contract or purchases a put option on a date before the noncancelable order is made.
B)	If Amerco enters into a forward contract or purchases a put option on the date when a noncancelable order is made by the customer
C)	If Amerco enters into a forward contract or purchases a put option on the date the sale is made
D)	All derivatives above can be designated as either cashflow hedge or fair value hedge.

Question 8 (Mandatory) (10 points)

How do we account for the fair value change in derivatives?

Question 8 options:

A)	If the derivative is designated as fair-value hedge, the gain/loss goes into balance sheet as other comprehensive income.
B)	If the derivative is designated as cashflow hedge, the gain/loss goes into balance sheet as other comprehensive income.
C)	If the derivative is bought for speculative purposes, the gain/loss goes into balance sheet as other comprehensive income.
D)	Irrespective of designation