Multiple Choice
A company uses futures to hedge a firm commitment to buy inventory. Which statement is true concerning the hedge?
A) The company takes a short position in futures and records changes in their value in OCI.
B) The company takes a long position in futures and records changes in their value in income.
C) The company takes a short position in futures and records changes in their value in income.
D) The company takes a long position in futures and records changes in their value in OCI.
Correct Answer:
Verified
Correct Answer:
Verified
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