Question
Where an entity prepares consolidated financial statements, the equity method is applied to associates or joint ventures of the _________________________ in the consolidated financial statements,
- Where an entity prepares consolidated financial statements, the equity method is applied to associates or joint ventures of the _________________________ in the consolidated financial statements, and not in the accounts of the ________ itself.
a) parent; parent
b) parent and its subsidiaries; subsidiary
c) parent; subsidiary
d) parent and its subsidiaries; parent.
2- Which of the following statements about hedge accounting is TRUE?
a) Hedge accounting is mandatory.
b) Hedge accounting is applicable only if a receivable is being hedged.
c) Hedge accounting is optional.
d) Hedge accounting is applicable only if a liability is being hedged.
3- On March 1, 2022, Eddie Ltd. issued a purchase order to Liu Inc. to acquire a crane for $400,000 SGD. On the same day, Eddie entered into a forward contract to receive $400,000 SGD on July 31, 2022. The crane was delivered on June 1, 2022, and payment was made July 31, 2022. Eddie has an April 30 year-end. The following information has been provided: (SCD = $X.XXX)
Date | Spot Rate | Forward rate to July 31, 2022 |
March 1, 2022 | .7686 | .7810 |
April 30, 2022 | .7702 | .7818 |
June 1, 2022 | .7940 | .7985 |
July 31, 2022 | .7995 | n/a |
Assume that the transaction qualifies as a cash flow hedge. On March 1, at what amount should the forward contract be reported?
a) $312,400
b) $317,600
c) $0
d) $319,800
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