Which of the Following Statements Is True Concerning Forward Contracts

question 30

Multiple Choice

Which of the following statements is true concerning forward contracts classified as hedges of an identifiable foreign currency commitment?

• A)​Forward contracts used as hedges cannot exceed the foreign currency commitment.
• B)​Forward contracts cannot extend for a time period after the transaction date of the commitment.
• C)​The gain or loss traceable to the time period after the transaction date of the commitment are treated as a hedge of a receivable or payable.
• D)​None of these statements is true.

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Definitions:

Forming

A process whereby team members meet for the first time, get to know each other, and try to understand where they fit into the team structure.

Avoid Conflict

A strategy or approach to prevent disagreements and disputes in interpersonal or group settings to maintain harmony and cooperation.

Decision-making Effectiveness

The quality of achieving a desired outcome efficiently through making informed decisions.

Storming

A phase in group development characterized by conflict and competition as team members clarify their roles and expectations.