Which of the following typically cannot be a hedged item?
A)Derivative instrument.
B)Accounts receivable.
C)Accounts payable.
D)Purchase order.

Question

Quizplus · Accepted Answer

Derivative instruments are typically used as hedging instruments rather than hedged items. Hedged items are assets, liabilities, firm commitments, or forecasted transactions that expose an entity to risk of changes in fair value or future cash flows, which can be hedged using derivatives or other instruments.

Which of the Following Typically Cannot Be a Hedged Item