User Account

All Pages

Explain how the journal entries affect the balance sheet

Assignment Help Operation Management
Reference no: EM131457692

ParentCo is a calendar year domestic corporation that ordered Product X from ExternalCo (foreign corporation) on November 1, 2013. The cost of Product X is 1,000,000FC (the foreign currency denomination). They enter into an agreement for the delivery of Product X by January 31, 2014. ParentCo entered into a forward exchange contract to acquire 1,000,000FC at a forward rate of $1.23/FC on January 31, 2014. Currently, the exchange rate between U.S. and the foreign country is $1.20/FC.

November 1, 2013 December 31, 2013 January 31, 2014 Spot Rate $1.20 $1.25 $1.30 Forward Rate $1.23 $1.26 $1.30 Using the applicable rates from above, explain the type of hedge that is being used and show the journal entries for all related transactions on 11/1/2013, 12/31/2013 and the 1/31/2014. In addition, show the effectiveness of the hedge.

Explain how the journal entries affect the balance sheet and income statement of ParentCo (use examples to support your responses).

Describe the effectiveness of the hedge. Show and explain all calculations. Note: ParentCo prepares year-end financial statements on 12/31/2013.

Reference no: EM131457692

Questions Cloud

What will the cash flows for this project be : You are evaluating project for The Ultimate recreational tennis racket, guaranteed to correct that wimpy backhand. What will the cash flows for this project be?
Penalty on early withdrawal of savings : On February 1, 2016, Ricardo and Marie deposited $10,000 into a one-year CD earning 2% interest at State Bank and Trust.
Perform the indicated operations and simplify : Perform the indicated operations and simplify - Multiply and simplify. Assume variables represent nonzero real numbers.
Choose one that you would like to explore : Though it might seem early to choose your topic, with only five weeks in the course, it is important to start early to best set yourself up for success.
Explain how the journal entries affect the balance sheet : ParentCo is a calendar year domestic corporation that ordered Product X from ExternalCo (foreign corporation) on November 1, 2013.
Next largest multiple of another integer : Write a C program to round off an integer i to the next largest multiple of another integer j. For example
Postfix expressions are evaluated : 1. Postfix expressions are evaluated according to the following rules:
Find alice three stocks to invest in from different segments : You need to find Alice 3 stocks to invest in from different segments of the market. The stocks should come from 3 varied sectors of the market.
What is the structure-composition of the material : What is the structure/composition of the material? What interactions with the environment are important for this material's function? Its safety?

Reviews

Write a Review

Operation Management Questions & Answers

  Is there any change in top rankings

After Miller makes the change in part (b), Germany announces it has reconsidered its offer of financial incentives, with an additional 200-million-euro package to entice BIA. Accordingly, BIA has raised Germany's rating to 10 on that factor. Is th..

  How do you change a complacent organization

Mark Bolten, CEO of Trans-Tech Corporation, is frustrated. Trans-Tech is the market leader in the manufacture of avionics components for commercial airliners and has been for years. But looking to the future, Mark sees problems. Put yourself in Mark'..

  Purpose of cleaning frequency schedules

The cleaning functions in large hotels are never contracted out to outside companies. The purpose of cleaning frequency schedules is to determine how often items need to be cleaned. The cost of labor for section housekeepers can be worked out by mult..

  Case to be analyazed in strategic management

Make powerpoint slides for a case to be analyazed in strategic management

  When should the raw material be reordered

Usage of the material during lead time is normally distributed with a mean of 42 pounds also a standard deviation of 4 pounds. When should the raw material be reordered if the acceptable risk of a stock out is 3percent.

  Show the costs of preventive maintenance

Draw a graph to show the costs of preventive maintenance and breakdown maintenance as a function of maintenance commitment. How do you solve for the lowest total maintenance cost?

  What is the projected total annual return

The employee credit union at State University is planning the allocation of funds for the coming year. The credit union makes four types of loans to its members. In addition, the credit union invests in risk-free securities to stabilize income. Risk-..

  What types of problems evolve when low-cost leadership

Write a brief assessment (two pages) of Walmart. Address three questions based on Walmart's business level strategy: What drivers of cost advantage make Walmart such a successful organization in the world of low-cost leadership? What types of problem..

  Reframing organizations including anne baretta case study

Select one alternative way both Anne and Steve could have dealt with the situation in the case study, and explain your reasoning. Discuss two possible aspects of their personalities or character that could have explained their behavior

  Compute activity slack and identify the critical path

You are completing a group term paper. Given the project network that follows, complete the forward and backward pass, compute activity slack, and identify the critical path. Use this information to create a Gantt chart for the project. Be sure to sh..

  Midst of a retrenchment corporate strategy

What are the advantages and disadvantages for an individual who accepts a job as a human resource manager in a company that is in the midst of a retrenchment corporate strategy? A reactor business strategy?

  Measures of productivity and multifactor productivity

In forecasting, explain how you would determine which variable is the independent variable, and which is the dependent variable? Regarding productivity what is the difference between measures of productivity and measures of multifactor productivity? ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd