Professional Documents
Culture Documents
4a Forex Quiz Theories
4a Forex Quiz Theories
Theories
2. Hedge accounting recognizes the offsetting effects on the profit or loss of changes
in fair values of hedging instruments and the hedge item
a. True
b. False
3. When importers and borrowers pay their obligations in foreign currency, they
benefit when their local currency weakens against the other currency. When exporters
and lenders receive payments in foreign currency, they benefit when their local
currency strengthens against the other currency.
a. True
b. False
5. Under fair value hedge, any forex gain or loss arising from hedged items will be
recognized at profit loss while the related gain or loss arising from hedging
instruments will be recognized in other comprehensive income
a. True
b. False
6. A transaction gain or loss at the settlement date is the difference between the
amount measured in the local currency of an account receivable denominated in a
foreign currency and the peso equivalent amount of the dollars received
a. True
b. False
7. Any difference in foreign currency exchange rates from initial recognition to every
reporting period must be presented at the profit or loss statements
a. True
b. False
Answer key:
1. B
2. A
3. B
4. TBA
5. B
6. A
7.
A.Y. 2021-2022
3A5