Advanced Accounting
12th Edition
ISBN: 9781305084858
Author: Paul M. Fischer, William J. Tayler, Rita H. Cheng
Publisher: Cengage Learning
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Chapter 9.M, Problem M.4.4P
To determine
Hedging:
Hedging against an investment risk is termed for strategically implementing the instruments and tools in the market to minimize the risk and effects of any adverse price movements. It can be said that investors are benefitted through hedging as they hedge one investment by making another investment.
The financial instruments like exchange traded funds, stocks, forward contracts, options, insurance, swaps, etc may construct hedge.
To calculate:
Annual net interest income on the note resulting from the purchase of the Louisiana plant.
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B10.
4. On 1/1/21 we sell equipment and accept a 3-year note receivable for $36,500.
The market value is $36,500. Payments of $13,655 include both principal and interest
and are to be made annually starting on 1/1/22. The present value of the payments is
$36,500. The bank would require the purchaser to pay interest of 6% in order to
borrow from them. The equipment cost us $90,000 and had a book value of $40,000.
Note: Be sure to show the date of each journal entry. The 'right' journal entry on the 'wrong' date is wrong.
a. Prepare an amortization table
b. Prepare the journal entry for 1/1/21
c. Prepare the journal entry for 12/31/21
d. Prepare the journal entry for 1/1/22
Amortization table:
Journal entries:
Debits
Credits
1/1/21
12/31/21
1/1/22
1. A note of P 55,000 dated January 1, 2015 is due in 5
years and 6 months with interest at 9% compounded
quarterly. On July 1, 2017, the holder of the note has it
discounted by a lender who charges 8 ½ % converted
semi-annually. What are the proceeds?
Chapter 9 Solutions
Advanced Accounting
Ch. 9.M - Prob. 1UTICh. 9.M - Prob. 2UTICh. 9.M - Prob. 3UTICh. 9.M - Prob. 4UTICh. 9.M - Prob. 5UTICh. 9.M - Prob. 1ECh. 9.M - Prob. 2ECh. 9.M - Prob. 3ECh. 9.M - Prob. 4.1ECh. 9.M - Prob. 4.2E
Ch. 9.M - Prob. 4.3ECh. 9.M - Prob. 4.4ECh. 9.M - Prob. 4.5ECh. 9.M - Prob. 4.6ECh. 9.M - Prob. 5ECh. 9.M - Prob. 6.1ECh. 9.M - Prob. 6.2ECh. 9.M - Prob. 7ECh. 9.M - Prob. M.1.1PCh. 9.M - Prob. M.1.2PCh. 9.M - Prob. M.2.1PCh. 9.M - Prob. M.2.2PCh. 9.M - Prob. M.3PCh. 9.M - Prob. M.4.3PCh. 9.M - Prob. M.4.4PCh. 9.M - Prob. M.4.5PCh. 9.M - Prob. M.4.6PCh. 9.M - Prob. M.5PCh. 9.M - Prob. M.6PCh. 9.M - Prob. M.7.1PCh. 9.M - Prob. M.7.2PCh. 9.M - Prob. M.7.3PCh. 9 - Prob. 1UTICh. 9 - Prob. 2UTICh. 9 - Prob. 3UTICh. 9 - Prob. 1.1ECh. 9 - Prob. 1.2ECh. 9 - Exercise 2 (LO 3) The accounting issues associated...Ch. 9 - Prob. 3.1ECh. 9 - Prob. 3.2ECh. 9 - Prob. 3.3ECh. 9 - Prob. 4.1ECh. 9 - Prob. 4.2E
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