1 answer

Assignment 4

USE U.S. GAAP CODIFICATION

For each of the following financial instruments Company A is a party to, fully explain whether the instrument qualifies as a derivative (show how the instrument meets all the requirements). Provide codification references where appropriate to justify your answer.

- Company A has entered into a purchase agreement with Company B to purchase 5 special order machines for $100,000. The agreement stipulates that Company B must have the machines ready for shipment no earlier than 3 months from the agreement date and no later than 6 months from the agreement. Company A must accept delivery and make payment when Company B ships the machines within the acceptable time period.

2. Company A has variable rate debt outstanding and is concerned about an increase in market interest rates occurring in the next two years. Too offset this possibility, Company A has entered into a two-year pay fixed, receive variable interest rate swap with a financial institution covering 75% of its variable rate debt.

3. Company A purchased 100,000 stock options allowing the company to purchase shares of Company B (a publicly traded company) anytime in the next three years for $80, the current market price of Company B stock. The options cost $3 each.

4. Company A paid $10,000 for the option to purchase a tract of land at its current market value during the next 18 months. The current market value of the land is $1,500,000.

5. Company A has guaranteed some of the debt of one of its subsidiaries. Company must pay the debt if the subsidiary’s credit rating is downgraded two levels during the life of the debt.

Assignment 4 USE GAAP CODIFICATIONS For each of the following financial instruments Company A is a party to, fully explain whether the instrument qualifies as a derivative (show how the instrument meets all the requirements). Provide codification references where appropriate to justify your answer 1 Company A has entered into a purchase agreement with Company B to purchase 5 special order machines for $100,000. The agreement stipulates that Company B must have the machines ready for shipment no earlier than 3 months from the agreement date and no later than 6 months from the agreement. Company A must accept delivery and make payment when Company B ships the machines within the acceptable time period 2. Company A has variable rate debt outstanding and is concerned about an increase in market interest rates occurring in the next two years. Too offset this possibility, Company A has entered into a two-year pay fixed receive variable interest rate swap with a financial institution covering 75% of its variable rate debt 3. Company A purchased 100,000 stock options allowing the company to purchase shares of Company B (a publicly traded company) anytime in the next three years for $80, the current market price of Company B stock. The options cost $3 each. 4.Company A paid $10,000 for the option to purchase a tract of land at its current market value during the next 18 months. The current market value of the land is $1,500,000 5. Company A has guaranteed some of the debt of one of its subsidiaries. Company must pay the debt if the subsidiary's credit rating is downgraded two levels during the life of the debt

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In the following reaction; identify Lewis acid: Fe+ (aq) + 6CN- (aq) Fe(CN)6 3 - (aq)

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What statement is major product of the following reaction? Starting material: 1-methyl-cyclopentene Reagent: 1) Hg(OAC)2, MeOH;...

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Eu HE ManaouQuestion (1.1 points)DcQmissing value that the following table represents probability distrbution-A40 310.160,061Write only numdeiYour anstcrYour AnswerAnsweiQuestion (1,1 points)The federal government has enacted maximum allowable standards forair pollutants qucn Uzune Xbe the number of days per vear that the leve air pollution exceeds the standard certain city: The probability distribution Xis given byL1 2Bxp33p.380.190,08b.04Find tne probability that the standard Eceened GnIcast

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Angle measures should be given to the nearest degree; distances should be given to the nearest tenth of a unit. Find the length of the radius in a regular decagon for which each apothem has a length of $12.5 \mathrm{cm}$

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Jana issues 30-year debt with a par value of $1,000 and a coupon rate of 10%,...

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In each reaction box, place the best reagent and conditions from the list below:1)"OH2) 3)O3; HzO, ZnHzO , H3OtCH3CHzOH, cat: HtKMnO4CHzCHO, cat HtNaOHHz; PdNaBHALiAIH4HOCHZCHZOH, cat: Ht

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Are the following statements true or false?If they are true, give proof: If they are false give numerica counter example:a. If A is square matrix satisfying |A? | = IA| then |A2| = 1b. If A is a 5 * 3 matrix, and B is a 35, then det(AB)

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Miller Co. started operations on January 1, 20x8. Data for the first year of operations is...

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Draw a structural formula for the major organic product of the reaction shown below:ClCuLiConsider E/Z stereochemistry of alkenes_ Do not show stereochemistry in other cases_ You do not have to explicitly draw H atoms_ Do not include organocopper or inorganic ion by-products in your answer

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10.02Done100f10gton tat $P32) (4.0.,1).(5,10,0)} Babrs 6 %

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Use the integral test to test the given series for convergence. $sum_{n=1}^{infty} frac{n+1}{n^{2}}$

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Identify the spectator ionts) in tne following reactiony Nicly Cuno u NikNo)iaal Cucl l Ni? and Cll b)I Culia| and No] Cu' and Ni?i Ni: and NO None ofithe above

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0 0 0 ceeter_ zero circumference charge 3586 2 of the Of tee circtet of +3.0 to 5 bring circle with distributed Grapeey of 8 3 uniformly 20 5 3 along Wa Syonw to the external

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Stratined soudmous eplthelium are Iound in *hich respiraton snucturt' Elattic cartilage JndMtenchnoDronctuEoeorsJerheQuestion 54Kartokener $ syndrome; characterlied by frequent rexpratory Intectiona; arises frorn dcrect whlcm resp ratory structure? Cetilig? utonhtrrc tatot cethciCbkct cshe bteekchiuln MJeuy Alcotu â‚¬ pillulesSutLsr W1 Mcolu eh

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(d) What is the marginal distribution of status? (Round your answers to four decimal places-) full-time 0.6793 part time 0.3248

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Question 3 The H-beam is made of an elastic-plastic material for which g-250 MPa. Determine the shape factor for the cross section of the H-beam. Also, determine the residual stresses in the top and...

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Briefly discuss the roles of the key enzymes and proteins involved in DNA replication in E.coli....

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Problem 7.9: The Qoutput of an edge-triggered D flip-flop is shown below in relation to the...

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Use the Integral test in part a) and P-scries in part b) to dctermine the convergence divergence of thc following series: (10 points)3n + 58b)5'

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Bb Q-id E3.a gibbs ^Go (in kJ) for the following reaction; Calculate the value of Fe203(s) 2 Fe(s) + 3 H2O(g) 3 H2(g) the values of AG;" (In (kymol) given below. using AG;" (Fe203) =-745. AG;" (HzO(g)) =-222 Enter value as an Integer (value + 2)

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Select Findthe 7 all that apply: other The polynomlal f(c) Zeros 0f 3 Eiven below Select all has correct 1 2 | 7 3 :

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I. Determine whether each of the subsets below are subspaces of R. (a) The line through...

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A country has 13,000 hours of labor to allocate across the production of two types of...

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Intent at 6% year $44,14271 Seppose payments willbe made for 7 the end of each semiamual period into an ondinary anmuity is $40,000, what should be the sine of each payment? R- 53,765.32 6.Deserm...

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Let's say you find that there is a main effect for gender but that education does...

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Verify The Identity?

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Let F(x,y,z) = e"zi+xzey-j +xyeyzk. 6. and curl of F _ (3 points) Find the divergence a

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34. The Light Record Corporation has been on the calendar year since its inception five years...

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4. Can the reactions of glycolysis simply be run in reverse to synthesize glucose? Why or...

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Cost of removing pollutants: $C(x)=\frac{k x}{100-x}$ Some industries resist cleaner air standards because the cost of removing pollutants rises dramatically as higher standards are set. This phenomenon can be modeled by the formula given, where $C(x)$ is the cost (in thousands of dollars) of removing $x \%$ of the pollutant and $k$ is a constant that depends on the type of pollutant and other factors. Graph the function for $k=250$ over the interval $x \in[0,100],$ and then use the graph to an

Cost of removing pollutants: $C(x)=\frac{k x}{100-x}$ Some industries resist cleaner air standards because the cost of removing pollutants rises dramatically as higher standards are set. This phenomenon can be modeled by the formula given, where $C(x)$ is the cost (in thousands of dollars) of removi...

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