--%>

Fin 335 International finance

1. The exchange rate is 1.22 Swiss francs per U.S. dollar. How many U.S. dollars are needed to purchase 1,500 Swiss francs? [$1,229.51]

2. You are planning an extended trip to Hong Kong. You have located some housing that you can lease for 9,400 Hong Kong dollars per month. What is the cost per month in U.S. dollars if the exchange rate is HK$1 = $.1279? [$1,202.26]

3. Your German friend has decided to come and visit you in the U.S. You estimate the cost of her trip at $4,800. What is the cost to her in Euros if the U.S. dollar equivalent of the euro 1.58? [€3,037.98]

 4. Currently, you can purchase either 106 Canadian dollars or 123 Japanese yen for $100. What is the C$/¥ cross rate?  [C$/¥ 0.8618]

5. Breakeven Point Analysis: TeeOff Corp produces golf umbrellas for several sports retail outlets. Their fixed costs are $600,000. The sell the umbrellas for $9.25 (MSRP). The variable costs per umbrella (labor and material) is $4.25. How many umbrellas must they sell to breakeven? (120,000)

QBEP = Fixed Costs / (P - VC)

 6. Clemson Software is considering a new project whose data are shown below.  The required equipment has a 3-year tax life, after which it will be worthless, and it will be depreciated by the straight-line method over 3 years.  Revenues and other operating costs are expected to be constant over the project's 3-year life.  What is the project's Year 1 cash flow? ($30,333)

 

Equipment cost (depreciable basis)                                        $65,000

Straight-line depreciation rate                                              33.333%

Sales revenues, each year                                                       $60,000

Operating costs (excl. depreciation)                                      $25,000

Tax rate                                                                                     35.0%

 

7. As assistant to the CFO of Boulder Inc., you must estimate the Year 1 cash flow for a project with the following data.  What is the Year 1 cash flow? ($5,950)

 

Sales revenues                                                            $13,000

Depreciation                                                                 $4,000

Other operating costs                                                   $6,000

Tax rate                                                                         35.0%

 

8. Your company, CSUS Inc., is considering a new project whose data are shown below.  The required equipment has a 3-year tax life, and the accelerated rates for such property are 33%, 45%, 15%, and 7% for Years 1 through 4.  Revenues and other operating costs are expected to be constant over the project's 10-year expected operating life.  What is the project's Year 4 cash flow? ($13,090)

 

Equipment cost (depreciable basis)                                        $70,000

Sales revenues, each year                                                       $42,500

Operating costs (excl. depreciation)                                      $25,000

Tax rate                                                                                     35.0%

   Related Questions in Finance Basics

  • Q : Depict the slope of the line Normal 0

    Normal 0 false false

  • Q : Question on balance sheet of Yukon Bank

    Normal 0 false false

  • Q : What can a financial institution do for

    What can a financial institution frequently do for a surplus economic unit which it would have complexity doing for itself if the surplus economic unit (SEU) were to deal directly along with a deficit economic unit (DEU)?Usually, Surplus economi

  • Q : Problem on tax and spend at possible

    Normal 0 false false

  • Q : Define the term Unencumbered Balance

    Define the term Unencumbered Balance: It is the balance of an appropriation not so far committed for particular purposes.

  • Q : What is Availability Period

    Availability Period: The time period throughout which an appropriation might be encumbered (that is, committed for expenditure), generally specified by the law making the appropriation. When no particular time is given in financial legislation, the pe

  • Q : Define Obligations Obligations : The

    Obligations: The amounts that a governmental unit might legally be needed to pay out of its resources. Budgetary authority should be obtainable before obligations can be formed. For budgetary aims, obligations comprise payables for goods or services r

  • Q : What is Shared Revenue Shared Revenue:

    Shared Revenue: It is a state-imposed tax, like the gasoline tax, that is shared with the local governments in proportion, or significantly in proportion, to the amount of tax collected or generated in each local unit. The tax might be collected eithe

  • Q : Explain Unscheduled Reimbursements

    Unscheduled Reimbursements: The Reimbursements collected by an agency which were not budgeted and are accounted for by an individual reimbursement class of an appropriation. To expend unscheduled reimbursements, the budget revision sh

  • Q : 222 what do you understand by planning

    what do you understand by planning premises