### Derivative instruments and investment classification

Assignment Help Accounting Basics
##### Reference no: EM1344731

a) Write down the differences between traditional and derivative instruments. Why do companies use derivative instruments? Are derivatives a good investment?

b) How do the various classifications of investments affect financial statements? What is the rationale behind the different accounting methods for the various investment classifications? Which is more important when determining the accounting method for securities, influence, or ownership? Explain why.

#### Questions Cloud

 Airbus plant relocation : This week, Airbus announced it was building new plant in Alabama. Can you aid me in answering the following questions based on information in conjunction with Foreign Direct Investment. Identify 5 strategies before investing money : An investor has many choices that need to be made before investing his or her money. Identify 5 strategies that require to be reviewed before an investor can reach his or her personal aims. What is the speed of the car : How fast must the car be travelling just as it leaves the cliff in order to clear the river and land safely on the opposite side. Cash flow from operations in a business : Which is most important to the business and why and what are the consequences a company may face if either of these is ignored? Derivative instruments and investment classification : Write down the differences between traditional and derivative instruments. Why do companies use derivative instruments? Are derivatives a good investment? What is the speed vfinal of the electron : You are standing 2.5 {rm m} straight in front of one of the two loudspeakers. They are 3 {rm m} apart and both are playing a 686 {rm Hz} tone in phase. As you begin to walk directly away from the speaker, at what distances from the speaker do you .. Describe method to execute account harvesting : Describe the threat of account harvesting. Suggest a method to execute an account harvesting attack on a Windows platform. How the string makes a 45 degree angle with the beam : The pulley is located so that the string makes a 45 degree angle with the beam. The beam is uniform, 5 meters long, and has weight. The professor stands 2 meters from the pivot point and has weight. Evaluate what was the united brands net income after tax : Federal income tax: united brands corporation just completed their latest fiscal year the firm had sales - Evaluate what was the United Brands net income after tax

### Write a Review

#### Methods of accounting for treasury stock

What are the two methods of accounting for treasury stock? Prepare the journal entry to record the purchase of treasury stock by the cost method.

#### Twin peaks building supplies

Chris White was a forestry technician who had been searching for several years for a business opportunity to combine with his forestry career

#### Money market hedge

Explain the steps to take for a money market hedge. You need to describe clearly the amounts which are related to the actions to take.

#### Determine cost to record the new asset from exchange

Chi Corporation trades an asset with a book value of \$20,000 for another asset with a fair market value of \$15,000. Find out Chi s cost to record the new asset from the exchange.

#### Asset turnover profit margin-target rate of return

Innovative Furnishing Solutions (IFS) a division of Steelman Corporation: Asset turnover Profit margin, Target rate of return on investments for RI, Cost of capital and other operational data, to compute the segment margin and the average assets f..

#### Classifying items into financing

For each of the following items, indicate whether it would be classified and reported under the operating activities (OA), investing activities (IA), or financing activities (FA) section of a statement of cash flows:

#### Determining the economic value of us division

Bella Vista’s U.S. Division reported sales of \$300,000-The economic value added of the U.S. Division is

#### Foreign competitors profitably

How could the foreign competitors profitably sell a similar product for less than manufacturing costs to Houston Electronic?

#### Pursuit of all self interest in contract

With that said, is pursuit of ALL self interest in contract unethical? If not, at what point does it become unethical?

#### Journalising-posting and preparing trial balance

Shelton Engineering completed the following transactions in the month of June. Prepare a trial balance as of the end of this month's operations

#### Find out franchisee breakeven sales in dollars

Find out a franchisee's breakeven sales in dollars. Is franchising good idea for Wong if franchisees want a minimum monthly operating income of \$6,000 and Wong believes that most locations could generate \$26,000 in monthly sales?

#### Insurance policy-utility function

What is the highest price that you would be willing to pay for an insurance policy that fully insures you in the event that your house burns down?