When Does Delivery Occur on a 90-Day Forward Contract

question 23

Multiple Choice

When does delivery occur on a 90-day forward contract?

• A) in 90 days corresponding to two business days preceding the third Wednesday of the month
• B) immediately but the contract is not closed for 90 more days
• C) in 90 days corresponding to the calendar date of the spot value date
• D) two business days following the spot value date

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Definitions:

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts, thereby preparing the accounts for the next period.

Journalized

Refers to the act of recording financial transactions in the company's journal as part of the accounting process.

Accounting Period

A specific duration of time used by businesses for financial reporting and accounting purposes, such as a month, quarter, or year.

Date

A specific point in time that may refer to a day, month, and year, often used in documentation and scheduling.