1.

Under special accounting treatment for cash flow hedge of a forecasted

transaction, the relationship between the value of the derivative instrument
and the change in value of the forecasted transaction affect the amount of
gain/loss that should be in OCI. If the gain on derivative is classified as OCI
is 20,000 and the cumulative loss on the remaining forecasted transaction
is 13,000, the amount of OCI to be reclassified as a component of current
earning is:

a) 13,000
b) 7,000
c) Not applicable
d) 20,000

2. On January 1, 2026, PTX Corporation purchased a 1-year at the money F

put option from an FX trader involving 1,000,000 foreign currency units
(FCUs) at a cost of P8,000. The exercise price was P40. The option was
obtained to hedge PTX budgeted 2026 export sales to British customers.
Actual export sales to foreign customers for the first quarter of 2026 were
300,000 FCUs. at March 31, 2026, the direct spot rate was P1.368 and the
options market value was P40,000. What amount is reported in Other
comprehensive income at March 31, 2026?

a) P21,000
b) P0
c) P32,000
d) P28,000
e) P4,000

3. On December 18, 2024, GC Trading sold a commodity to a foreign firm.

Payment of 1,000,000 foreign currencies (FC) is due on February 16, 2025.
Concurrently, GC Trading paid P4,000 cash to acquire a 60-day put option
for 1,000,000 FC. GC trading follows calendar basis of reporting:

12/18/2024 12/31/2024 02/16/2025

Spot rate (market price) P0.16 P0.15 P0.147

Strike price (exercise price) 0.16 0.16 0.16

Fair Value of call option P4,000 P13,300 P13,000

 What is the notional amount? 1,000,000 FC
 What is the intrinsic value on December 31, 2024? P10,000