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RoseWind [281]
3 years ago
12

15 points) Assume the following information regarding U.S. and European annualized interest rates: Currency Lending Rate Borrowi

ng Rate U.S. Dollar ($) 6.73% 7.20% Euro (€) 6.80% 7.28% Trainor Bank can borrow either $20 million or €20 million. The current spot rate of the euro is $1.13. Furthermore, Trainor Bank expects the spot rate of the euro to be $1.10 in 90 days. What is Trainor Bank's dollar profit from speculating if the spot rate of the euro is in fact $1.10 in 90 days?
Business
1 answer:
Masja [62]3 years ago
5 0

Answer:

The Trainor Bank's dollar profit from speculating if the spot rate of the euro is in fact $1.10 in 90 days is $5,79,845

Explanation:

Bank Z borrow = €20 million

Spot rate 1€ = $1.13  

Convert € in to $

€20 million *1.13 = $22.60 million  

Lend $2,26,00,000 at interest rate of 6.73% for 90 days ( Assume total number of days in a year is 360)

= $2,26,00,000 + $2,26,00,000*(90/360)*6.73%

= $2,29,80,245

We need to find the euro to be repaid  = €2,00,00,000 + €2,00,00,000*7.28%*(90/360)

= €2,03,64,000

To be repaid in $:-

€2,03,64,000*1.10 = $2,24,00,400

Profit from speculating in $ = $2,29,80,245 - $2,24,00,400

                                             = $5,79,845

Therefore, The Trainor Bank's dollar profit from speculating if the spot rate of the euro is in fact $1.10 in 90 days is $5,79,845

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Refer to the following selected financial information from McCormik, LLC. Compute the company's current ratio for Year 2. Year 2
swat32

Answer: 3.39

Explanation: Current ratio can be defined as a liquidity ratio which is used by the accountants the evaluate the ability of the company to pay its short term obligations. It can be computed as follows :-

current\ ratio=\frac{curret\ assets}{current\ liabilities}

where,

current assets = $38,500 + $100,000 + $90,500 + $126,000 + $13,100 = $368,100

current liabilities = $108,400

now putting the values into equation we get :-

current\ ratio=\frac{368,100}{108,400}

                             = 3.39

8 0
3 years ago
One challenge faced by organizations is the need to focus on consumer needs while also ________ the interests of countless other
Hitman42 [59]

One challenge faced by organizations is the need to focus on consumer needs while also striking a balance among the interests of countless other people, groups, and forces that interact to shape the nature of their actions.

<h3>What does it mean to strike a balance?</h3>

It is to have equal importance, it is a condition in which different things occurring have an equal or proper amount of importance.

An organization striking a balance is trying to do everything possible to meet people's demands and also overcoming various challenges that may want to influence it.

Therefore, One challenge faced by organizations is the need to focus on consumer needs while also striking a balance among the interests of countless other people, groups, and forces that interact to shape the nature of their actions.

Learn more on customers satisfaction here

brainly.com/question/7943284

5 0
2 years ago
High Country Corporation acquired two inventory items at a lump-sum cost of $80,000. The acquisition included 6,000 units of pro
SCORPION-xisa [38]

Answer:

$9,000

Explanation:

Calculation for the amount of gross profit that should be recognize

First step is to calculate the

A's sale value = 6,000 unit*12 per unit

A's sale value = $72,000

Second Step is to calculate B's sale value

B's sale value = 14,000 units*4 per unit

B's sale value= $56,000

Third step is to calculate the Total sale value

Total sale value = $72,000 + $56,000

Total sale value= $128,000

Fourth Step is to calculate the Cost of goods sold of A for 6,000 units and 2,000 units

Cost of goods sold of A for 6,000 units = ($72,000/$128,000) * $80,000

Cost of goods sold of A for 6,000 units = 0.5625*$80,000

Cost of goods sold of A for 6,000 units= $45,000

Cost of goods sold of A for 2,000 units = $45,000*2,000/6,000

Cost of goods sold of A for 2,000 units = $15,000

Last step is to calculate the Gross profit of A for 2,000 units

Gross profit of A for 2,000 units = (2,000*12 per units) - 15,000

Gross profit of A for 2,000 units = $24,000 - $15,000

Gross profit of A for 2,000 units = $9,000

Therefore the amount of gross profit that should be recognize will be $9,000

7 0
2 years ago
Walton Company has provided the following 2018 data:
timurjin [86]

Answer:

Walton Company

Income Statement

                                   Actual                Budgeted            Variances

Sales                          510,400                 $ 519,000              8,600 U

Variable product costs    183400             188,000                 4,600 F        

Variable selling expense   48100              46,000                  2,100 U

Other variable expenses  5100                  3,300                  1,800 U

Contribution Margin      273,800              281,700              7,900 unfav

Fixed product costs   15460                       15,700                  240 F

Fixed selling expense   22920                   23,400                 480 F

Operating Income      235420                    242,600          7,180  unfav

Other fixed expenses   1460                       1,300                 160 U

Interest expense            710                          800                   90 F      

Net income                 233,250                  240,500           7,250 unfav

We calculate the actual amounts from the budgeted amount by adding the variances when they are unfavorable and subtracting them when they are favorable . But in case of sales this is reversed. The actual sales are calculated by   subtracting unfavorable variance from budgeted sales.

The fav amounts are subtracted from the unfav amounts to get the results .

8,600 u + ( 4,600)F + 2,100 U +1,800= 7,900 unfav

                               

3 0
3 years ago
Drying times for newly painted microwave oven cabinets are normally distributed with a mean of 2.5 minutes and a standard deviat
Marina86 [1]

Answer: 3.22

Explanation:

Given that;

mean = 2.5 min

standard deviation = 0.25 min

now to get the value of X required, we say

z = (x - u) / a

where z is the distance from the mean measured in the standard deviation units, x is the value we are interested in, u is the mean distribution, a is the standard deviation of the distribution.

the time delay should be just enough to allow 99.8% of the cabinets to dry completely = 99.8/100 = 0.9980

first we determine an appropriate z value.

Using the standardized normal tables,

value of z for approximately 0.9980 is 2.88

so using our initial equation z = (x - u) / a

we substitute the value

z = (x - u) / a

2.88 = ( x - 2.5) / 0.25

2.88 * 0.25 = x - 2.5

0.72 = x - 2.5

x = 0.72 + 2.5

x = 3.22

5 0
2 years ago
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