On November 1, 2020 a trader took a long position in three futures contracts on a commodity that expires on March 31", 2021. The initial futures price is $60. On December 31, 2020 the futures price is $61. On Feb 28, 2021 it is $64. The contract is closed out on February 28, 2021 What gain is recognized in the accounting year from January 1 to December 31, 2020? Each contract is on 1000 units of the commodity and the transaction qualities to be considered as a hedge. A. $0 B. $3,000 C. $9,000 D. $12,000
On November 1, 2020 a trader took a long position in three futures contracts on a commodity that expires on March 31", 2021. The initial futures price is $60. On December 31, 2020 the futures price is $61. On Feb 28, 2021 it is $64. The contract is closed out on February 28, 2021 What gain is recognized in the accounting year from January 1 to December 31, 2020? Each contract is on 1000 units of the commodity and the transaction qualities to be considered as a hedge. A. $0 B. $3,000 C. $9,000 D. $12,000
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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inance Department 7. On November 1, 2020 a trader took a long position in three futures contracts on a commodity that expires on March 31", 2021. The initial futures price is $60. On December 31, 2020 the futures price is $61. On Feb 28, 2021 it is $64. The contract is closed out on February 28, 2021 What gain is recognized in the accounting year from January 1 to December 31, 2020? Each contract is on 1000 units of the commodity and the transaction qualities to be considered as a hedge.
A. $0
B. $3,000
C. $9,000
D. $12,000
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