HW (Chap 01 - Probs 8, 9)_b (updated)-2.xls - Problem 1.8...

This preview shows page 1 - 2 out of 2 pages.

Problem 1.8 Luzon's EPS Sensitivity to Exchange Rates (B)US ParentBrazilianGermanChineseCompanySubsidiarySubsidiarySubsidiaryBusiness Performance (000s)(US$)(reais, R$)(euros, €)(yuan, Y)Earnings before taxes, EBT (local currency)4,500.00 6,250.00 4,500.00 2,500.00 Less corporate income taxes35% (1,575.00)25% (1,562.50)40% (1,800.00)30% (750.00)Net profits of individual subsidiary2,925.00 4,687.50 2,700.00 1,750.00 Avg exchange rate for the period (fc/$)------ 1.8000 0.7018 7.7500 Net profits of individual subsidiary (US$)$ 2,925.00 $ 2,604.17 $ 3,847.25 $ 225.81 Consolidated profits (total across units)$ 9,602.22 Total diluted shares outstanding (000s)650.00 $ 14.77 Brazilian reais falls in value against the U.S. dollar and Luzon's Brazilian sales declineUS ParentBrazilianGermanChineseCompanySubsidiarySubsidiarySubsidiaryBusiness Performance (000s)(US$)(reais, R$)(euros, €)(yuan, Y)Earnings before taxes, EBT (local currency)4,500.00 5,800.00 4,500.00 2,500.00 Less corporate income taxes (enter as negative, e.g.: 35% (1,575.00)25% (1,450.00)40% (1,800.00)30% (750.00)Net profits of individual subsidiary2,925.00 4,350.00 2,700.00 1,750.00 Avg exchange rate for the period (fc/$)------ 3.0000 0.7018 7.7500 Net profits of individual subsidiary (US$)$ 2,925.00 $ 1,450.00 $ 3,847.25 $ 225.81 Consolidated profits (total across units)$ 8,448.06

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture