Near the end of the Year One, a company buys two derivatives that will come due in the next year. One of these derivatives was properly designed as a cash flow hedge. The other derivative was properly designed as a fair value hedge. By the end of the year, the fair value of both of these derivatives had increased. Where will these gains be reported?
a) In net income for both hedges
b) In accumulated other comprehensive income for both hedges
c) In net income for the fair value hedge and in accumulated other comprehensive income for the cash flow hedge.
d) In net income for the cash flow hedge and in accumulated other comprehensive income for the fair value hedge.