Find amount of forward loss should parker company recognize

Assignment Help Financial Accounting
Reference no: EM132775576

On January 2, 2020, Parker Company enters into a forward contract to purchase on January 2, 2022, a specified number of barrels of oil at a fixed price. Parker Company does not pay anything to enter into the forward contract on January 2, 2020. Parker Company does not designate the forward contract as a hedging instrument. At the end of 2020, the fair value of the forward contract has increased to P400,000 and at the end of 2021 its fair value has declined to P350,000.

Problem 1: Assuming Parker Company is speculating that the price of oil will increase and plans to net settle the contract if the price increases, what amount of forward loss should Parker Company recognize at December 31, 2021 statement of comprehensive income?

Group of answer choices

a. P400,000

b. P350,000

c. P50,000

d. None

Reference no: EM132775576

Questions Cloud

What amount of gain on forward contract esther company : The contract will be settled net in cash. What amount of gain on forward contract should Esther Company recognize on December 31, 2020?
How ought the christian think about sickness and health : In 400-500 words, respond to the following: How ought the Christian think about sickness and health? How should a Christian think about medical intervention?
What amount should esther company recognize as forward asset : What amount should Esther Company recognize as forward asset on January 31, 2020? On January 31, 2020, Esther Company enters into a contract
How should a christian think about medical intervention : In 400-500 words, respond to the following: How ought the Christian think about sickness and health? How should a Christian think about medical intervention?
Find amount of forward loss should parker company recognize : On January 2, 2020, What amount of forward loss should Parker Company recognize at December 31, 2021 statement of comprehensive income?
What amount of forward loss should parker company recognize : What amount of forward loss should Parker Company recognize at the end of year 2021? At the end of 2020, the fair value of the forward contract has increased
What is your definition of spiritual care : What is your definition of spiritual care? How does it differ or accord with the description given in the topic readings? Explain. The response must be typed.
Find what is carrying value of available for sale investment : On October 1, 2020, Parker Company invests P3,000,000 in abound, What is the carrying value of the available for sale investment on October 1, 2020?
Describe what are your strengths and weaknesses : When it comes to facilitating spiritual care for patients with worldviews different from your own, what are your strengths and weaknesses?

Reviews

Write a Review

Financial Accounting Questions & Answers

  How much did know about interest and borrowing money

Is there anything that you would like to improve upon in this course? How much did you know about interest and borrowing money before starting Unit 6?

  What is responsibility accounting

What is responsibility accounting? Is it used at your current (or former) place of employment, and if not, would it work? Why or why not? Explain the difference and similarity between corporation company and partnership company ? How would you hedge ..

  Is that consistent with us gaap

How does British Airways, Plc. (BA)account for “other current interest-bearing deposits”? Is that consistent with U.S. GAAP? What is the amount of those investments that are maturing after three months, as of March 31, 2009?

  Determine the average rate of return on the equipment

Midwest Fabricators Inc. is considering an investment in equipment that will replace direct labor. The equipment has a cost of $132,000 with a $16,000 residual value and a 10-year life. The equipment will replace one employee who has an average wage ..

  Create a contribution margin format income statement

Create a contribution margin format income statement

  Prepare the adjusting entries required at april

Arif Khan's Air Service operates several small airplanes providing passenger, Prepare the Adjusting entries required at April 30, 2009?

  Make the journal entries for bill-and-hold arrangement

Make the journal entries for this bill-and-hold arrangement (assuming that conditions for recognizing the sale have been met) for Crane on June 1

  Hardware of computer system includes the computer

The hardware of a computer system includes the computer itself and other devices that help the computer perform its tasks. These “other devices” are commonly also called:

  Prepare a budget variance template

Prepare a budget variance template in Excel that links to forecasts and tracks actual verses budgeted income statement and balance sheet

  Calculate the pv of mr decos payment

Calculate the PV of Mr. Deco's payment using the equivalent real cash flow and real discount rate. You should get exactly the same answer as he did.

  Create what balance under current liabilities in the dec

Prepare the entries to reflect the above transactions for 2019 and 2020, assuming Canada co. earn any unearned warranties equally over warranty life.

  Discuss how to compute earnings and profits

Can you discuss how to compute earnings and profits (E&P)? - What income is deferred to a later year when computing taxable income, but is included in E&P in the current year?

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!

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