EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN: 9781337514835
Author: MOYER
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Chapter 2, Problem 11P
Summary Introduction
To determine: The total cost and cost per watch in country dollar and the total cost and cost per watch country U dollar of 12,000 watches.
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On October 15, 2014, Napole Corporation, a French company, ordered merchandise listed on the internet for 20,000 euro from Adams Corporation, a U.S. corporation. The euro rate was $1.20 (U.S. dollars) on October 15. On November 15, 2014, Adams shipped the goods and billed Napole the purchase price of 20,000 euro when the euro rate was $1.30. Napole paid the bill on December 10, 2014, and Adams immediately exchanged the 20,000 euro for US dollars when the euro rate was $1.28 on December 10, 2014. Compute the foreign currency gain or loss on the December 31, 2014 financial statements of Adams and show the related journal entries
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per Euro.
Determine the following:
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2.
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Briefly discuss implications of the transaction.
Chinook, Inc. purchases components from a Japanese company that requires payment in yen (Y); it sells finished products to a German company that pays in euros. On June 1, Chinook ordered components from the Japanese Company costing Y6,890,000 and sold finished goods to the German company with a selling price of $150,000 to be paid in euros. The June 1 spot rates of U.S. dollars for yen and for euros was:
$1 = Y106.0
$1 = E0.84
Required:
1. What is the cost of the Y6,890,000 in dollars?
2. How many euros will Chinook receive from the German company in payment for the finished product?
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Chapter 2 Solutions
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Ch. 2.A - Prob. 1QTDCh. 2.A - Prob. 2QTDCh. 2.A - Prob. 3QTDCh. 2.A - Prob. 1PCh. 2.A - Prob. 2PCh. 2.A - Prob. 3PCh. 2.A - Prob. 4PCh. 2.A - Prob. 5PCh. 2.A - Prob. 6PCh. 2.A - Prob. 7P
Ch. 2.A - Prob. 8PCh. 2 - Prob. 1QTDCh. 2 - Prob. 2QTDCh. 2 - Prob. 3QTDCh. 2 - Prob. 4QTDCh. 2 - Prob. 5QTDCh. 2 - Prob. 6QTDCh. 2 - Prob. 7QTDCh. 2 - Prob. 8QTDCh. 2 - Prob. 9QTDCh. 2 - Prob. 10QTDCh. 2 - Prob. 1PCh. 2 - Prob. 2PCh. 2 - Prob. 3PCh. 2 - Prob. 4PCh. 2 - Prob. 5PCh. 2 - Prob. 6PCh. 2 - Prob. 7PCh. 2 - Prob. 8PCh. 2 - Prob. 9PCh. 2 - Prob. 10PCh. 2 - Prob. 11PCh. 2 - Prob. 12PCh. 2 - Prob. 13P
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