Answer:
implied credit spread = 1.13 %
Explanation:
given data
interest on foreign government bonds = 7.5%
current exchange rate = 28
forward exchange rate = 28.5
risk-free rate = 4.5%
solution
we get here risk free rate by the forward exchange rate that is
F = spot exchange rate × \frac{1+Rr}{1+Rs} ....................1
put here value
28.5 = 28 × \frac{1+Rr}{1+0.045}
solve it we get
Rr = 0.0637
Rr = 6.37%
so
implied credit spread = interest on foreign government bonds - risk free rate
implied credit spread = 7.5% - 6.37%
implied credit spread = 1.13 %
Answer: The correct answer is "D. It begins when the engagement letter is signed and continues until the report for the third year is issued unless the relationship is terminated sooner.".
Explanation: The statement "It begins when the engagement letter is signed and continues until the report for the third year is issued unless the relationship is terminated sooner." best describes the period of the professional engagement as it applies to a three-year engagement to audit client's financial statements since this type of professional commitment begins with the signing of the document that formalizes the commitment and is in force until the issuance of the last report unless the relationship is resolved beforehand by another circumstance.
Answer:
$8750.87
Explanation:
This is compound interest problem. The formula used to solve this would be:
Where
F is the future value (what we want, after 3 years)
P is the initial value (given 6900)
r is the rate of interest per period
here, 8% per year, so 8/4 = 2% per period (since compounded per quarter)
t is the time (3 years and compounding per year so times of compounding is 3*4 = 12), so t = 12
Substituting, we get our answer:
<u>There will be about $8750.87 at the account at the end of 3 years!</u>
Answer:
False
Explanation:
Contribution margin per unit = Sales - variable cost
Contribution margin per unit (Model A) = $432 - $404
Contribution margin per unit (Model A) = $28 per unit
Contribution margin per unit (Model B) = $410 - $304
Contribution margin per unit (Model B) = $106 per unit
False, Contribution margin per unit (Model B) is higher so, motivated to push sales of Model A will be false.
Break-even in units = Fixed cost / Contribution margin per unit
Break-even in units (Model A) = Fixed cost / $28
Break-even in units (Model B) = Fixed cost / $106
Answer:
(a) Physical controls
(b) Human resource controls
(c) Independent internal verification
(d) Segregation of duties
(e) Establishment of responsibility
Explanation:
(a) All over-the-counter receipts are entered in cash registers. That is an example of the physical controls principle.
(b) All cashiers are bonded. That is an example of the human resource controls principle.
(c) Daily cash counts are made by cashier department supervisors. That is an example of the independent internal verification principle.
(d) The duties of receiving cash, recording cash, and having custody of cash are assigned to different individuals. That is an example of the segregation of duties principle.
(e) Only cashiers may operate cash registers. That is an example of the establishment of responsibility principle.
