How costs revenue and earnings items would be affected

Assignment Help Financial Management

Reference no: EM13936349

Measuring economic exposure. Using the following cost and revenue information shown for DeKalb plc (UK) determine how the costs, revenue, and earnings items would be affected by three possible exchange rate scenarios for the New Zealand dollar (NZ$): (1) NZ$ ¼ £0.40, (2) NZ$ ¼ £0.44, and (3) NZ$ ¼ £0.48. (Assume UK sales will be unaf- fected by the exchange rate.) Assume that NZ$ earn- ings will be remitted to the UK parent at the end of the period.

Revenue and cost estimates for DeKalb plc
	UK business £m	New Zealand business NZ$m
Sales	800	800
Cost of goods sold	500	100
Gross profit	300	700
Operating expenses	300	0
Earnings before and taxes interest	0	700
Interest expense	100	0
Earnings before taxes	-100	700

Reference no: EM13936349

Questions Cloud

What is the maximum inventory level : If they wish to produce this product in economic batches, what size batch should be used? What is the maximum inventory level? How many order cycles are there per year? How much does management of this good in inventory cost the firm each year?

Define a class called revenue that has 2 private members : Use public functions of the class in a program that computes RevenueValue and displays RevenueValue when demand is 2000 and price is 2.

Ehealth software solutions : eHealth Software Solutions is a medium-sized company of 110 employees, with an impressive record for producing innovative healthcare software solutions for the health industry, including doctors' practices and small to medium sized medical clinics..

Create a class that simulates an alarm clock : Store time in hours, minutes, and seconds. Note if time is AM or PM. (Hint: You should have separate private members for the alarm and the clock. Do not forget to have a character variable representing AM or PM.)

How costs revenue and earnings items would be affected : determine how the costs, revenue, and earnings items would be affected by three possible exchange rate scenarios for the New Zealand dollar.

Define and create an exception : Quotient throws an exception to the higher-level function main to decide whether or not the program should be terminated. Main catches the divByZero and prints out an appropriate comment on the screen. Also include in main a try block to catch the..

Religious and spiritual systems of belief : Compare and Contrast: Religious and Spiritual Systems of Belief, This question is fairly open ended in order to shed light into an important methodology in cultural anthropology: comparative methods

Marketing as an exchange process : Your report is to produce an interesting article based on your organisation, with up to three visual illustrations if appropriate. Different sections of the article should cover: marketing as an exchange process, a philosophy of business, and a ma..

Determine the value of all the three securities : Determine the price of the bonds, if Mr. M's required rate of return is 8% p.a. for both bonds - Determine the value of all the three securities to Mr. Y, given his required rates of return.

User Account

All Pages