ACCT 540 Week 6 Course Project: Recommendations and Conclusions
The goal that Thomas Foods needs to achieve is to protect themselves from the possibly of any financial losses from the prices of produce from their vendors. The focal point that could ultimately change the prices of their produce would be drastic changes or fluctuations of weather conditions. Thomas Foods would be interested in utilizing a hedge strategy safeguard operating income and have contracted myself to be a consultant to implement the hedging strategy. Through thorough research, I was led to conclude that first, hedge accounting would work the best when a transaction is directly made with the producer supplier. Second, employing a Purchase Order system would be advantageous for Thomas Foods to alleviate risks of rising prices. And lastly, training the company’s controller on hedge accounting……………
