Question

In: Accounting

1. In general, derivative instruments are a. Not reported in a company's balance sheet, because their...

1. In general, derivative instruments are

a. Not reported in a company's balance sheet, because their impact on the company is not yet known

b. Reported in the balance sheet at fair value and changes in their fair value are reported in earnings

c. Reported in the balance sheet at historical cost and changes in their fair value are reported in earnings

d. Reported in the balance sheet at fair value and changes In they fair value are reported in other comprehensive income

2. A company can accomplish off-balance sheet financing using all of the following except

a. Operating leases

b. Zero-coupon bonds

c. Special purpose entities

d. All of the above

Solutions

Expert Solution

1. In general, derivative instruments are

Answer

d. Reported in the balance sheet at fair value and changes In they fair value are reported in other comprehensive income

2. A company can accomplish off-balance sheet financing using all of the following except

Answer

a. Operating leases


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