Explain the "wedding band" in P&G's 1994 German mark interest rate swap
What will be an ideal response?
Starting on 16 January 1995 (the second year of the swap), P&G's terms changed so the spread paid by P&G to BT went from 133 basis points to a premium that depended on whether the 4-year, German mark swap rate was below 4.05% or above 6.10% at any point during the previous year. The "wedding band" was the range within which the DM swap rate could vary without changing P&G's premium.
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When a business reports an asset at an inflated dollar amount, is has violated the measurement issue of
A) recognition. B) valuation. C) classification. D) realization.
Which of the following is NOT a basic characteristic of a system of cash control?
a. Use of a voucher system b. Combined responsibility for handling and recording cash c. Daily deposit of all cash received d. Internal audits at irregular intervals
Once the potential exporter has established that there may be a market for the firm's products, it's time to
A. identify international agents. B. set up an export department. C. prepare an export marketing plan. D. identify international distributors. E. hire a customs broker.
A business collects cash from a customer for services that were performed one month earlier. Which of the following accounts is debited?
A) Cash B) Accounts Receivable C) Service Revenue D) Accounts Payable