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vazorg [7]
3 years ago
15

An exchange rate is 0.7000 and the six- month domestic and foreign risk- free interest rates are 5% and 7% (both expressed with

continuous compounding). What is the six- month forward rate
Business
1 answer:
aalyn [17]3 years ago
3 0

Answer:

0.693

Explanation:

Given that

Exchange rate = 0.7

Interest Rates = 5% and 7%

The calculation of six-month forward rate is shown below :-

= Spot Rate x e^ (Domestic Rate - Foreign Rate) x Domestic Rate

= 0.7 x e^ ((0.05 - 0.07) x 0.05)

= 0.7 x e^ -0.001

= 0.7 x 0.99

= 0.693

Hence, the six-month forward rate is 0.693. we simply find the six moth rate by applying the formula.

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Anita is developing a website for her photography business. On the home page, she wants to include a link to another webpage in
kotegsom [21]

Relative link can be inserted.

A relative link thinks that the page to which you're connected is the website and folder to which you've posted the web page. This link is under the same website URL and folder (Articles) as this page, thus we only refer to it by this link. There are two advantages of using relative references versus absolute references.

A Relative Reference is a partial http address that is a portion of a whole directory path. Remember that if no server name or path is supplied in html, the file reference will default to the current directory.

Therefore the answer is relative link.

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4 0
2 years ago
Star Appliance sells previously owned appliances. Each appliance carries a one-year warranty against defects. Suppose that appli
lawyer [7]

Answer:

$1,500

Explanation:

Data provided in the question

Sales for the appliances for the entire month = $50,000

Expected future warranty cost = 3% of sales

By considering the above information, the amount that should be reported as a liability is    

= Sales for the appliances for the entire month × Expected future warranty cost

= $50,000 × 3%

= $1,500

Simply we multiplied the sales with the given percentage so that the liability amount could arrive

6 0
3 years ago
As of December 31, 2018, Warner Corporation reported the following: Dividends payable $ 32,000 Treasury stock 570,000 Paid-in ca
Thepotemich [5.8K]

Answer:  $9,182,000

Explanation: This question can be done as follows :-

Total shareholders equity = paid in capitals + other paid in capitals + retained earnings - treasury stock

Putting the values into equation we get :-

Total shareholders = $32,000 + $5,200,000 + $4,200,000 - $250,000

equity

                                = $9,182,000

8 0
3 years ago
Crystal Apple Sales Company began 2014 with cash of $2,000, inventory of $3,600 (200 crystal apples that cost $18 each), $2,500
Andru [333]

Answer and Explanation:

a. The computation of ending inventory and cost of goods sold using the three different cost flow assumptions: FIFO, LIFO, and Weighted Average is shown below:-

Cost of goods sold = (200 × $18) + (800 × $20) + (1,040 × (2,040-200-800)

= (200 × $18) + (800 × $20) + (1,040 × $24)

= $3,600 + $16,000 + $24,960

= $44,560

Ending Inventory Under FIFO = (1,200 - 1,040) × (2,040-200-800)

= 160 × $24

= $3,840

Under LIFO method

Cost of goods sold is

= (1,200 × $24) + (800 × $20) + (40 × $18)

= $28,800 + $16,000 + $720

= $45,520

Ending Inventory Under LIFO is

= (200 - 40) × $18

= 160 × $18

= $2,880

Weighted Average cost flow Assumption

Weighted Average cost per apple = Cost of Beginning inventory and purchase ÷ Total apple available

Cost of Beginning inventory and purchases is

= (200 × $18) + (800 × $20) + (1,200 × $24)

= $3,600 + $16,000 + $28,800

= $48,400

Total apples available is

= 200 + 800 + 1,200

= 2,200  

Weighted Average cost per apple is

= $48,400 ÷ 2,200

= $22

Cost of goods sold is  

= 2,040 × $22

= $44,880

Ending Inventory is

= 160 × $22

= $3,520

b. The Preparation of income statement, a balance sheet, and a statement of cash flows under each of the three cost flow assumptions is prepared below:-

Income Statement                       Amount

Sales (2,040 × $40)                     $81,600

Less: Cost of goods sold            ($44,560)

Gross Profit                                  $37,040

Less: Operating Expenses         ($26,000)

Income before income taxes      $11,040

Less: Income tax (30% × $11,280) ($3,312)

Net Income                                     $7,728

Balance Sheet

Assets  

Cash                                                   $9,488

Inventory                                             $3,840

Total Assets                                        $13,328

Liabilities and Stockholder's Equity

Common Stock                                   $2,500

Retained Earnings                              $10,828

Total Liabilities and Equity                $13,328

Working note

cash = (opening + Sales - Purchases - Operating expenses - Income tax expenses )

= $2,000 + $81,600 - $44,800 - $26,000 - $3,312

= $9,488

Retained earning = (Opening + Net Income)

= $3,100 + $7,728

= $10,828

Statement of Cash Flow

Cash Flow from Operating Activities  

Cash Sales                                               $81,600

Payment to Accounts Payable              ($44,800)

Operating Expenses                              ($26,000)

Income tax paid                                      ($3,312)

Net Increase in cash and

cash equivalents                                     $7,488

Add: Opening Cash and

cash equivalents                                     $2,000

Closing Cash and cash equivalents      $9,488

LIFO cost flow Assumption

Income Statement

Sales (2,040 × $40)                                 $81,600

Less: Cost of goods sold                         ($45,520)

Gross Profit                                              $36,080

Less: Operating Expenses                     ($26,000)

Income before income taxes                  $10,080

Less: Income tax (30% × $10,080)             ($3,024)

Net Income                                               $7,056

Balance Sheet

Assets  

Cash                                                           $9,776

Inventory                                                    $2,880

Total Assets                                               $12,656

Liabilities and Stockholder's Equity

Common Stock                                           $2,500

Retained Earnings                                       $10,156

Total Liabilities and Equity                         $12,656

Working note:-

Cash = (opening + Sales - Purchases payment - Operating expenses -Income tax expenses)

= $2,000 + $81,600 - $44,800 - $26,000 - $3,024

= $9,776

Retained earning = (Opening + Net Income)

= $3,100 + $7,056

= $10,156

Statement of Cash Flows  

Cash Flow from Operating Activities  

Cash Sales                                             $81,600

Payment to Accounts Payable            ($44,800)

Operating Expenses                            ($26,000)

Income tax paid                                     ($3,024)

Net Increase in cash and

cash equivalents                                     $7,776

Add: Opening Cash and

cash equivalents                                     $2,000

Closing Cash and cash equivalents       $9,776

Weighted Average cost flow Assumption

Income Statement  

Sales (2,040 × $40)                                   $81,600

Less: Cost of goods sold                         ($44,880)

Gross Profit                                               $36,720

Less: Operating Expenses                       ($26,000)

Income before income taxes                   $10,720

Less: Income tax (30% × $10,720)           ($3,216)

Net Income                                                $7,504

Balance Sheet  

Assets  

Cash                                                           $9,584

Inventory                                                   $3,520

Total Assets                                              $13,104

Liabilities and Stockholder's Equity

Common Stock                                         $2,500

Retained Earnings                                     $10,604

Total Liabilities and Equity                       $13,104

Working note

Cash = opening + Sales - Purchases payment - Operating expenses - Income tax expenses )

= $2,000 + $81,600 - $44,800 - $26,000 - $3,126

= $9,584

Retained earning = (Opening + Net Income)

= $3,100 + $7,504

= $10,604

Statement of Cash Flows

Cash Flow from Operating Activities

Cash Sales                                       $81,600

Payment to Accounts Payable      ($44,800)

Operating Expenses                       ($26,000)

Income tax paid                               ($3,216)

Net Increase in cash and

cash equivalents                              $7,584

Add: Opening Cash and

cash equivalents                            $2,000

Closing Cash and

cash equivalents                               $9,584

8 0
3 years ago
On late-night TV, you see an infomercial claiming that the price of the product has been slashed for a special offer and now inc
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The answer is that’s-not-all
3 0
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