2.99 See Answer

Question: Assuming that Brandt entered into a forward


Assuming that Brandt entered into a forward contract to sell 10 million South Korean won on December 1, 2020, as a fair value hedge of a foreign currency receivable, what is the net impact on its net income in 2020 resulting from a fluctuation in the value of the won? Brandt amortizes forward points on a monthly basis using a straight-line method. Ignore present values.
a. No impact on net income
b. $100 decrease in net income
c. $250 decrease in net income
d. $2,000 increase in net income

2.99

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