What is the company total profit-when is it realized

Assignment Help Financial Management
Reference no: EM132044712

Suppose that in September 2015 a company takes a long position in a contract on May 2016 crude oil futures. It closes out its position in March 2016. The futures price (per barrel) is $88.30 when it enters into the contract, $90.50 when it closes out its position, and $89.10 at the end of December 2015. One contract is for the delivery of 1,000 barrels. What is the company's total profit? When is it realized? How is it taxed if it is (a) a hedger and (b) a speculator? Assume that the company has a December 31 year-end.

Reference no: EM132044712

Questions Cloud

Where did the budget process fail : Green Felt-Tip Pens, a Tape Recorder, and Embezzlement: Where did the Budget Process Fail?
How clinical interview influence interpretation test result : Compare and contrast the use of the Rorschach, a projective measure, with the MMPI, an objective measure. Construct a scenario, and present both sides.
How accounting standards impact financial measures : How accounting standards impact financial measures (ratios, covenants, etc.)
Identify common denominator descriptions : Based on the articles, identify common denominator descriptions of those perpetrating the particular criminal behavior you are working with.
What is the company total profit-when is it realized : One contract is for the delivery of 1,000 barrels. What is the company's total profit? When is it realized?
Calculate the accrued interest of bond issue : Calculate the clean price of the bond issue. Calculate the accrued interest of the bond issue.
Assess their implications and generate alternatives : What are the accounting issues (GAAP/IFRS compliance issues), assess their implications, generate alternatives.
What is payback period of this investment : it is expected to make $4.1 million in the year it is released and $1.7 million for the following four years. What is the payback period of this investment?
Examine the impact of each law on human resources management : Using the first e-Activity, choose two (2) employment laws, and examine the impact of each law on human resources management (HRM).

Reviews

Write a Review

Financial Management Questions & Answers

  What is the current dividend and dividend yield

What is the current dividend? What is the dividend yield? What is the PE ratio?

  What is intrinsic value of the stock today

A stock is expected to pay a dividend of $1.00 next year and $1.50 in 2 years, after that the dividend is expected to grow at a constant rate of 4% per year forever. The stock s required rate of return is 11%. What is intrinsic value of the stock tod..

  Assume that salary payments are equal amounts paid

Assume that the salary payments are equal amounts paid at the end of each month.

  What are accounting standards

Summarize the IASB's Framework for the Preparation and Presentation of Financial Statements. What are accounting standards?

  If you believe in efficient market hypothesis

If you believe in the efficient market hypothesis, you should also believe that ____

  Analyze the various aspects of finance

Analyze the various aspects of finance that management must understand. Examine the role of management as it relates to finance in a corporation.

  What did investors expect the interest rate

What did investors expect the interest rate to be on the one-year Treasury bill two years from that date if the term premium on a two-year Treasury note was 0.02%.

  What amount would the insurance company pay

The Kelleher family has health insurance coverage that pays 75 percent of out-of-hospital expenses after a yearly deductible of $500 per person. If one family member has doctor and prescription medication expenses of $1,280 for the year, what amount ..

  Approaches to projects costs of capital entails

Which one of the following approaches to a project’s costs of capital entails the use of another firm’s cost of capital rather than the use of your own firm’s cost of capital?

  Bringing boards more deeply into governance-risk assessment

What potential might there be for bringing Boards more deeply into governance and risk assessment issues than in the past,

  How much is each payment to individual bond holder

What is the annual coupon interest rate rounded to the nearest percent? How much is each payment to an individual bond holder?

  New york stock exchange and bonds traded over the counter

Litten Oil and Gas Company is a large company with common stock listed on the New York Stock Exchange and bonds traded over the counter.

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