Accounting for Investments, Volume 2: Fixed Income Securities and Interest Rate Derivatives—A Practitioner's Guide

PROBLEM 1: CROSS CURRENCY INTEREST RATE SWAP—USD/EUR

Prepare

Journal entries, general ledgers, trial balance, income statement, and balance sheet.

T-1 On purchase of cross-currency interest rate swap trade:

T-2 Accrued interest on valuation date—pay leg:

T-3 On reversal of accrued interest on coupon date—pay leg:

T-4 On accounting for interest on coupon date—pay leg:

T-5 On settlement of interest on pay leg:

T-6 Accrued interest on valuation date—pay leg:

T-7 On reversal of accrued interest on coupon date—pay leg:

T-8 On accounting for interest on coupon date—pay leg:

T-9 On settlement ...