Question-Keller Graduate School of Management AC555ON Financial 7 PassMaster
CPA-00928 Type1 M/C A-D Corr Ans: A PM#1 F 7-01
1. CPA-00928 FARE R03 #4 Page 5
On November 2, 2001, Platt Co. entered into a 90-day futures contract to purchase 50,000 Swiss francs
when the contract quote was $.70. The purchase was for speculation in price movement. The following
exchange rates existed during the contract period:
30-day futures | Spot rate | |
November 2, 2001 | $0.62 | $0.63 |
December 31, 2001 | 0.65 | 0.64 |
January 30, 2002 | 0.65 | 0.68 |
What amount should Platt report as foreign currency exchange loss in its income statement for the year
ended December 31, 2001?
CPA-00930 Type1 M/C A-D Corr Ans: D PM#3 F 7-01
2. CPA-00930 FARE C98 #1 Page 3
Fair value disclosure of financial instruments may be made in the:
CPA-00931 Type1 M/C A-D Corr Ans: B PM#4 F 7-01
3. CPA-00931 FARE C98 #2 Page 3
Disclosures about the following kinds of risks are required for most financial instruments.