You have been asked to evaluate possible sites for an Asian production facility that will manufacture your firm's products and sell them to the Asian market. What real exchange rate considerations should you entertain in your evaluation?
What will be an ideal response?
You must be aware of the strength or weakness of the real exchange rates in the various countries. Because your firm will be exporting from the country in which the plant is located, your profits will be hurt by a future real appreciation of the currency of that country relative to the currencies of countries to which you export. Your costs would rise with no corresponding benefit in sales. Thus, if the potential production country currency is currently severely undervalued on foreign exchange markets, this country may appear to be a low cost production center, but it is likely that this cost advantage will be eroded by a real appreciation in the future.
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Internal use software costs are
A) always expensed. B) always capitalized. C) capitalized once the preliminary cost is completed. D) capitalized once the preliminary cost is completed and the software will be used to perform the function intended.
Hybrid costing systems can only be applied to manufacturing.
Answer the following statement true (T) or false (F)
In the ________ process, the decision maker determines how well each alternative scores on a criterion using pairwise comparisons
A) linear programming B) simplex tableau C) goal programming D) analytical hierarchy
Garza Corporation has two production departments, Casting and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Casting Department's predetermined overhead rate is based on machine-hours and the Customizing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: CastingCustomizingMachine-hours 20,000 13,000Direct labor-hours 1,000 7,000Total fixed manufacturing overhead cost$152,000$68,600Variable manufacturing overhead per machine-hour$2.10 Variable manufacturing overhead per direct labor-hour $4.30The estimated total manufacturing overhead for the Customizing Department is closest to:
A. $30,100 B. $54,110 C. $68,600 D. $98,700