Problem

A forward exchange contract may be used (a) to manage an exposed foreign currency position...

A forward exchange contract may be used (a) to manage an exposed foreign currency position, (b) to hedge an identifiable foreign currency commitment, (c) to hedge a forecasted foreign cur­rency transaction, or (d) to speculate in foreign currency markets. What are the main differences in accounting for these four uses?

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Solutions For Problems in Chapter 11