James D’Elia FN 316 International Financial Management Professor Dunbar Case #3 Blades Inc. Chapter 5 1) If Blades used call options to hedge its Yen in payables‚ they are presented with 2 options. They can hedge at a lower exercise price (.00756) with a higher premium (2%); of they can hedge at a higher exercise price (.00792) with a lower premium (1.5%). Traditionally‚ the premiums are normally 1.5%‚ however due to recent uncertainty they have risen. This presents a tradeoff between an exercise
Premium Futures contract Foreign exchange market Exchange rate
BLADES‚ INC. CASE Assessment of Future Exchange Rate Movements As the chief financial officer of Blades‚ Inc.‚ Ben Holt is pleased that his current system of exporting “Speedos” to Thailand seems to be working well. Blades’ primary customer in Thailand‚ a retailer called Entertainment Products‚ has committed itself to purchasing a fixed number of Speedos annually for the next 3 years at a fixed price denominated in baht‚ Thailand’s currency. Furthermore‚ Blades is using a Thai supplier for some
Premium Finance Thailand Bangkok
458 Part 4: Long-Term Asset and Liability Management Consequently‚ Burton received only 6 million Swiss francs at the end of the year. Also assume that the spot rate of the franc at the end of the year was $.79. Determine the net present value of this project for Burton Co. if these conditions occur. 31. Hedge Decision on a Project. Carlotto Co. (a U.S. firm) will definitely receive 1 million British pounds in 1 year based on a business contract
Premium Forward contract Thailand Bangkok
Study on the Competitiveness of the European Steel Sector Within the Framework Contract of Sectoral Competitiveness Studies – ENTR/06/054 Final report‚ August 2008 Client: Directorate-General Enterprise & Industry ECORYS SCS Group P.O. Box 4175 3006 AD Rotterdam Watermanweg 44 3067 GG Rotterdam The Netherlands T +31 (0)10 453 88 16 F +31 (0)10 453 07 68 E fwc-scs@ecorys.com W www.ecorys.com Registration no. 24316726 Table of contents Executive summary...........................
Premium European Union Steel
Chapter 4 1. If you invest $1000 today at an interest rate of 10% per year‚ how much will you have 20 years from now‚ assuming no withdrawals in the interim? SOLUTION: n PV FV PMT Result 20 2. i 10 1000 ? 0 FV =6‚727.50 a. If you invest $100 every year for the next 20 years‚ starting one year from today and you earn interest of 10% per year‚ how much will you have at the end of the 20 years? b. How much must you invest each year if you want to have
Premium Compound interest Rate of return Time value of money
19‚ 2012 Muhammad Enamul Haque Assistant Professor United International University Subject: Submission of term paper on ‘’case analysis’’ Dear Sir‚ We are pleased to submit the term paper on time letter. Here is the term paper on “case solution”‚ you asked us to conduct. As you are teaching us about the international business‚ as per the requirement of syllabus provided from United International University for B.B.A. course‚ considering its importance‚ you assigned this task. Sir
Premium Foreign exchange market Futures contract United States dollar
CHAPTER 4: ACCOUNTING FOR GOVERNMENTAL OPERATING ACTIVITIES ( ILLUSTRATIVE TRANSACTIONS AND FINANCIAL STATEMENTS Solutions to Exercises and Problems 4-2. 1. a. 6. a. 2. c. 7. c. 3. d. 8. c. 4. b. 9. b. 5. d. 10. b. Ch. 4‚ Solutions (Cont’d) 4-3. a. Calculation of Estimated Required Tax Anticipation Financing Estimated Expenditure Requirements: Budgeted expenditures‚ remainder of FY 2011 $2‚470‚000 Current liabilities
Premium Generally Accepted Accounting Principles Finance Fiscal year
Case Problem: Blades‚ Inc. 1. One point of concern for you is that there is a tradeoff between the higher interest rates in Thailand and the delayed conversion of baht into dollars. Explain what this means. ANSWER: If the net baht-denominated cash flows are converted into dollars today‚ Blades is not subject to any future depreciation of the baht that would result in less dollar cash flows. 2. If the net baht received from the Thailand operation are invested in Thailand‚ how will
Premium Finance Income statement Rate of return
Solutions to Homework Assignments: Chapter 4 6. Are all capital gains (gains on the sale or disposition of capital assets) taxed at the same rate? Explain. No. If a taxpayer holds a capital asset for a year or less the gain is taxed at ordinary tax rates. If the taxpayer holds the asset for more than a year before selling‚ the gain is generally taxed at a maximum 15% rate but could be taxed as high as 20% for high income taxpayers. If the taxpayer sells more than one capital asset during the year
Premium Taxation in the United States
the carrying value of an asset is not recoverable. Per the same standards‚ carrying value is not recoverable “if it exceeds the expected future cash flows to be derived from the asset on an undiscounted basis” (FASB‚ ASC 360-10). In the Property Solutions Inc. case‚ the carrying value of the building on 10/1/2017 was $1‚650‚000 and the expected future cash flows are $1‚214‚940. Per the definition of impairment loss stated above‚ the asset is impaired. In calculating the loss‚ we must compare the carrying
Premium Generally Accepted Accounting Principles Asset Balance sheet