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1.On January 1, 2013, LLB Industries borrowed $200,000 from trust Bank by issuing a two-year, 10% note, with interest payable quarterly. LLB entered into a two-year interest rate swap agreement on January 1, 2013, and designated the swap as a fair value hedge. Its intent was to hedge the risk that general interest rates will decline, causing the fair value of its debt to increase. The agreement called for the company to receive payment based on a 10% fixed interest rate on a notional amount of $200,000 and to pay interest based on a floating interest rate. The contract called for cash settlement of the net interest amount quarterly.Floating (LIBOR) settlement rates were 10% at January 1, 8% at March 31, and 6% June 30, 2013. The fair values of the swap are quotes obtained from a derivatives dealer. Those quotes and the fair values of the note are as indicated below. The additional rise in the fair value of the note (higher than that of the swap) on June 30 was due to investors perceptions that the creditworthiness of LLB was improving.
Required:1. Calculate the net cash settlement at June 30, 2013.2. Prepare the journal entries on June 30, 2013, to record the interest and necessary adjustments for changes in fair value. Use the extended method demonstrated in Illustration 3.
The company has decided to restructure the operations at one of its stores. As part of this restructuring, the company has determined that the store facility is impaired. The store originally cost $3,000,000 and has accumulated depreciation of $1,..
quantity variances for direct cost categories direct materials and direct labor are based on differences between the
One problem with this plan is that the liabilities of his sole proprietorship exceed the basis of the assets to be transferred to the corporation by $70,000 ($20,000 - $130,000). Therefore, Joel would be required to recognize a gain of $70,000.
Onslow Co. purchases a used machine for $240,000 cash on January 2 and readies it for use the next day at an $8,000 cost. On January 3, it is installed on a required operating platform costing $1,600, and it is further readied for operations.
write a 350- to 500-word summary explaining the differences between revenue expenditures and capital expenditures
1.On October 1, 2013, Farmer Fabrication issued stock options for 100,000 shares to a division manager.
Determine the sample process including sample contact, survey distribution, and survey collection.
How would you update the journal entries with the answered balances?
kramer corporation is a diversified manufacturer of consumer goods. the company activity based costing system has the
Review and discuss what the general rules are for agricultural activity using US GAAP and IFRS and determine the inventory valuation for TFI on June 30 using both US GAAP and IFRS.
The prevailing rate of interest for a note of this type on January 1, 2010, was 9%. At what amount should the gain from the sale of the building be reported?
on january 1 2015 alamar corporation acquired a 40 percent interest in burks inc. for 210000. on that date burkss
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