When accounting for forward contracts, what is meant by the term “executory contract”?
A. No cash changes hands.
B. The CEO of the company is the only one authorized to engage in the contract.
C. There must be a price paid for the option.
D. The contract is not valid unless both parties sign it.
Answer:A
When accounting for forward contracts, what is meant by the term “executory contract”?
A. No cash changes hands. B. The CEO of the company is the only one authorized to engage in the contract. C. There must be a price paid for the option. D. The contract is not valid unless both parties sign it.