Ch17 P15 Build a Model - 4/19/2010 Chapter 17. Ch 17-15...

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Unformatted text preview: 4/19/2010 Chapter 17. Ch 17-15 Build a Model TABLE 17-1 (abridged) Exchange rates of select major currencies, relative to the U.S. dol ar Direct Indirect Quotations Quotations British pound 1.4915 0.6705 Mexican peso 0.0758 13.1978 Euro 1.3276 0.7532 Japanese yen 0.0101 98.8600 TABLE 17-2 (abridged) Key Currency Cross-Exchange Rates Dol ar Euro Pound Peso Yen Japan 98.86000 131.2465 147.4497 7.4906 .. Mexico 13.19780 17.5214 19.6845 .. 0.1335 United Kingdom 0.67050 0.8901 .. 0.0508 0.0068 Euro 0.75320 .. 1.1235 0.0571 0.0076 United States .. 1.3276 1.4915 0.0758 0.0101 a. How much, in dol ars, does it cost for Yohe to produce the SY-20? What is the dol ar sale price of the SY-20? Input Data Cost of component X (in euros € 84 Cost of component Y (in pesos) 650 Cost of component Z (in pounds) £105 Sale price of the SY-20 (in yen) 38,000 We wil convert the cost of each component to dol ars, and find the total cost of the SY-20. We wil do the same to find th dol ar sale price. Component X Cost of X in $ = Cost in euro x Direct spot exchange rate ($/euro) Cost of X in $ = x Cost of X in $ = Component Y Cost of Y in $ = Cost in pesos x Direct spot exchange rate ($/peso) Cost of Y in $ = x Cost of Y in $ = Component Z Cost of Z in $ = Cost in pounds x Direct spot exchange rate ($/pound) Cost of Z in $ = x Cost of Z in $ = TOTAL COST OF THE SY-20 (in dol ars) = Revenue from sale of the SY-20 Sale price (in $) = Price in yen x Direct spot exchange rate ($/yen) Sale price (in $) = x Sale price (in $) = SY-20 SALES PRICE (in dol ars) = b. What is the dol ar profit that Yohe makes on the sale of the SY-20? What is the percentage profit? The dol ar profit from the sale of the SY-20 is simply the sales revenue minus the total cost. Dol ar profit = Sales price- Total cost Dol ar profit =- Dol ar profit = The percentage profit is determined as the dol ar profit divided by the total cost. % profit = $ profit / Total cost % profit = / % profit = c. If the U.S. dol ar were to weaken by 10% against al foreign currencies, what would the dol ar and percentage profits b for the SY-20?...
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This note was uploaded on 10/22/2011 for the course ACCOUNTING 1102 taught by Professor Borges during the Spring '11 term at InterAmerican Recinto Metropolitano.

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