Answer:
d. $96,914
Explanation:
Parker Co. can execute money market hedge in following steps:
(1) Parker Co. pledges Receivable of SF200,000 to borrow SF190,476 with rate 5% in Switzerland; SF190,476 = SF200,000/ (1+5%)
so it has to pay interest expense of SF9,524 in 360 days. The receivable of SF200,000 is enough for both principal and interest in 360 days.
(2) Then it sells SF190,476 at spot rate $0.48 to get $91,428
(3) Then it deposits $91,428 in US with rate 6% to get back $96,914 in 360 days
; $96,914 = $91,428 * (1+6%)
My answer would be C ''Foreign Exchange Rate''.
Answer:
The answer is: Obligation that has a distant due date exceeding company's operating cycle.
Explanation:
A current liability is a financial obligation due within one year (or one normal operation cycle).
So a financial obligation that has a due date that exceeds a company´s operating cycle should have been directly classified as a long term liability (or a non current liability) in the first place. It simply is not a current liability that is changed into a long term liability, it always was a long term liability.
The other options represent the steps necessary for turning a current liability into a long term liability.
- Intend to refinance the obligation on a long-term basis.
- Demonstrate the ability to complete the refinancing.
- Subsequently refinance the obligation on a long-term basis.
Answer: See explanation
Explanation:
a. What stock price is expected 1 year from now?
This will be calculated as:
= P0 × (1 + g)
where,
P0 = $40
g = growth rate = 7%
= P0 × (1 + g)
= 40 × (1 + 7%)
= 40 × (1 + 0.07)
= 40 × 1.07
= $42.80
b. What is the required rate of return?
This will be:
= (D1 / P0) + g
where D1 = D0 × (1+g) = 1.75 × (1+0.07) = 1.75 × 1.07 = 1.8725
= (D1 / P0) + g
= (1.8725 / 40) + 0.07
= 0.1168
= 11.68%
Answer:
$437,000
Explanation:
We first, find the net cash flow for the current period, and then, add the cash balance for the period immediately before.
Net cash flow for current period:
Cash provided by operating activities $310,000
Cash used by investing activities ($120,000) - we substract this because the cash was "used", that is to say, it was spent.
Cash provided by financing activities $149,000
Net cash flow: $339,000
Ending cash balance = Net cash flow + beginning cash balance
= $339,000 + 98,000
= $437,000
