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3 years ago

Which of the following statements about the reporting of variances is not true?

Business

1 answer:

RideAnS [48]3 years ago

3 0

Answer:

The correct answer is (B)

Explanation:

A variance report is an archive that helps to examine the difference between actual and predict financial statements. Likewise, it also assists in analysing what should occur and what occurred. Normally, fluctuation reports are utilised to dissect the distinction among spending plans and real execution. In that regard, variance reports are not reported to external financial statement users.

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A company has derivatives transactions with Banks A, B, and C which are worth +$20 million, −$15 million, and −$25 million, resp

timurjin [86]

Answer:

1. With Bilateral Clearing, where the company posts variation margin, but no initial margin:

The company has to provide collateral to Banks A, B, and C of $0 million, $15 million, and $25 million respectively.

Therefore, the total collateral required is $40 million.

2. With Central Clearing through the CCP, where the CCP usually requires an initial margin of $10 million:

The derivatives are netted against each other, and the company’s total variation margin is $20 million (–$20 + $15 + $25) in total.

The total margin required (including the initial margin) is, therefore, $30 million ($20 + $10 million).

Explanation:

a) Data and Calculations:

Worth of derivative with Bank A = +$20 million

Worth of derivative with Bank B = -$15 million

Worth of derivative with Bank C = -$25 million

b) In a bilateral clearing, the company and each bank (called market participants) enter into an agreement with each other to cover all outstanding derivative transactions between the two parties. On the other hand, in central clearing, a central clearing party (CCP) stands between the two sides of an OTC derivative transaction in much the same way that the exchange clearing house does for exchange-traded contracts.

3 0

3 years ago

You are the manager of a retail store. Shipments of the products you sell arrive once a week from the central warehouse and you

Tasya [4]

The BEST way to handle the situation is to work with central warehouse to arrange a predictable delivery time. Whereas, the WORST way to handle the situation is to change the delivery system so that goods are delivered only once a month.

So, if you are the manager of a retail store, and the shipments of the products you sell arrive once a week from the central warehouse you need to pull a couple of your workers from inside the store who can unload the shipments. As the truck arrives any time in a day, this creates problem as the workers are not availabe whenever the shipment arrives.

The best way through which one can handle the situation is by working with central warehouse to get appropriate information on the delivery date and so that the workers are made available accordingly. Whereas, the worst way to handle this situation is by changing the delivery system.

Hence, options 2 and 3 are correct.

To learn more about delivery system here:

brainly.com/question/28420229

#SPJ1

5 0

1 year ago

Wealth creating transactions are more likely to occur a. With private property rights b. With contract enforcement c. Both a a

Marina86 [1]

Answer: C

Explanation:

Wealth is the gradual gathering of profits, assets or income over a period of time. It is the gradual increase in ones assets over a sustained period.

Wealth creating transactions can be found both in contract enforcement and private property rights. The prosperity and economic development of a country can be attributed to the respect accorded to its citizens property rights.

Property rights gives room for entrepreneurship which can eventually lead to wealth accumulation. Contract enforcement also generate wealth for individuals.

8 0

3 years ago

4. The fee the bank charges the issuer of a bad check is a...

ZanzabumX [31]

I believe it is a non-sufficient funds fee

3 0

3 years ago

Ariana and John, who file a joint return, have two dependent children, Kai and Angel. Kai is a freshman at State University and

mihalych1998 [28]

The amounts and types of education tax credits that Ariana and John can take without modified AGI limitation are as follows:

Amount of Education Tax Type of Education Tax Credits

For Kai $1,000 ($2,500 x 40%) The American Opportunity Credit

For Angel $1,560 ($7,800 x 20%) The Lifetime Learning Credit

Total tax credit = $2,560 ($1,000 + $1,560)

<h3>What are the American Opportunity Credit and the Lifetime Learning Credit?</h3>

Whereas the American Opportunity Credit (Kia's) covers only the first 4 years of post-secondary education at 40% of $2,500 per student because Kia is a half-time student, the Lifetime Learning Credit applies to graduate schooling (Angel's) and covers 20% of the first $10,000 paid for tuition.

We must note that no taxpayer can claim both the American Opportunity Credit and the Lifetime Learning Credit for the same student in the same tax year.

Thus, the total education tax credit that Ariana and John can claim for both Kai and Angel is $2,560.

Learn more about education tax credits at brainly.com/question/8166956

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2 years ago