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Please i need your help urgently Can you give me the answer in details ?!!!!
Example : Fair value hedge
On 1 July 20X6 Joules acquired 10000 ounces of a material which it held in its inventory. This cost $200 Per ounce, So a total of $2 Million, Joules was concerned that the price of this inventory would fall, so on 1 july 20X6 he sold 10000 ounces in the future market for $210 per ounce for delivery on 30 June 20X7.
On 1 july 20X6 the conditions for hedge accounting were all me.
At 31 December 20X6 , The end of joules’ reporting period, the fair value of the inventory was $220 per ounce while the futures price for 30 June 20X7 delivery was $227 per ounce. On 30 June 20X7 The trader sold the inventory and closed out the futures position at the then price of 230 per ounce
Required
Set out the accounting entries in respect of the above transactions.Here am I concentrating my whole existence on trying to get students through their governance, risk and ethics exam and you feel that it is appropriate for me to answer a technical question on fair value hedges where the issue has arisen ( I presume ) from your work.
In brief, no, I’m sorry, I cannot help you 🙁
Ya I appreciate what You do but i am going to have my exam in F7 and this point is very hard to understand
Hi! There is NO WAY that this is coming in the F7 exam! I seriously doubt that it will be asked in P2. And even if it did come up, it’s not going to be worth more than 2 marks!
Concentrate on consolidations, preparation of financial statements, cash flows and interpretations. The rest will follow naturally.
Hi! There is NO WAY that this is coming in the F7 exam! I seriously doubt that it will be asked in P2. And even if it did come up, it’s not going to be worth more than 2 marks!
Concentrate on consolidations, preparation of financial statements, cash flows and interpretations. The rest will follow naturally.
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