Car Corp. (a U.S.-based company) sold parts to a Korean customer on December 16, 2018, with payment of 10 million Korean won to be received on January 15, 2019. The following exchange rates applied:DateSpot RateForward Rate to Jan.15December 16, 2018$0.00092 $0.00098 December 31, 2018 0.00090 0.00093 January 15, 2019 0.00095 0.00095 ?Assuming a forward contract was entered into on December 16, what would be the net impact on Car Corp.'s 2018 income statement related to this transaction? Assume an annual interest rate of 12% and a fair value hedge. The present value for one half-month at 12% is .9950.
A. $298 (gain).
B. $700 (loss).
C. $700 (gain).
D. $300 (loss).
E. $995 (gain).
Answer: A
You might also like to view...
The specialized language of a particular profession or industry is known as clichés
Indicate whether the statement is true or false.
Compared to standardized global marketing, adapted global marketing ________
A) uses the same marketing mix elements in all target markets B) lowers marketing costs by using home country sales teams C) modifies marketing strategies to meet local needs D) maintains uniformity across all markets E) results in greater brand power
Which of the following is the last step in a return on investment (ROI) analysis?
A. Dividing benefits by costs B. Placing a value on the outcomes C. Calculating the total savings D. Identifying the outcomes E. Determining the training costs
Describe how work flows are managed along a supply chain. Provide at least one example from the emergency services industry. In emergency services, it is critical that decision makers have access to information on inventory locations and amounts to provide time-critical services.
What will be an ideal response?