[jeff]

Welcome to the Q1 2016 CPA Exam Study Group for BEC.

Some BLITZ videos to help your exams: https://www.another71.com/ninja-blitz

Jeff Elliott, CPA (KS) | Another71 | NINJA CPA | NINJA CMA | NINJA CPE

[FAR_WARS]

is it 0?

FAR- 80
BEC- 75
AUD- 78
REG- ?

[monikernc]

yes. it is 0. i will post solution. outside with my dog right now and the wind is howling here.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

I think is 0$ NI is 60,000 (.08*750000) and capital 500,000 (750,000/1.5)

60,000 – 500,000*.12 = 0

[monikernc]

2 winners!!!

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[monikernc]

An American importer expects to pay a British supplier 500,000 British pounds in three months. Which of the following hedges is best for the importer to fix the price in dollars?

Select an answer:
A.
Buying British pound call options

B.
Buying British pound put options

C.
Selling British pound put options

D.
Selling British pound call options

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

B?

[monikernc]

The coso cloud doc i posted earlier is pretty good. Quick read. I am taking friday off to study even more! Can't wait!!!
Farwars, it will be you and me for reg because everyone else will be done! REG, ugh.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[payaza2000]

Is it A?

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[monikernc]

Solution A.
An American importer who will pay a British supplier in the future is concerned about the value of the British pound increasing against the U.S. dollar. If this happens, it will take more dollars to repay the loan. The importer would hedge against a rise in British pounds by purchasing a British pound call option. This option is the right to purchase British pounds at a future date. If and when the price of British pounds rises, the importer would exercise the option and then sell the futures contract at a profit. The profit made would offset the cost of paying more in U.S. dollars to the British supplier.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

So if its were a receivable then it would have purchased the put option?

[Anonymous]

I have to go over those foreign exchanges

[payaza2000]

Hey @Cortes

I found this to be a pretty good explanation of call & put optionshttps://m.youtube.com/watch?v=EfmTWu2yn5Q

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[Anonymous]

Thanks payaza! 🙂

[monikernc]

Cortes, that is how i understand it. Buy calls for payables. Buy puts for receivables.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

monikernc thanks.

[Author]

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