Assuming a Forward Contract Was Entered into on December 16

question 58

Multiple Choice

Assuming a forward contract was entered into on December 16, how would the forward contract be reflected on Car's December 31, 2018 balance sheet?

• A) Forward contract (asset).
• B) Forward contract (liability).
• C) Foreign currency (asset).
• D) Foreign currency (liability).
• E) Foreign exchange (liability)

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Definitions:

Peau D'orange

A term describing skin that looks dimpled or puckered, resembling the surface of an orange, commonly associated with inflammatory breast cancer.

Thickened

The condition or process of becoming denser or more compact in structure.

Exaggerated

Describes something that is overstated or made to seem more important or serious than it actually is.

Gambler's Fallacy

The incorrect idea that an increased frequency of an event in a certain period means it will happen less often later on, or the reverse.