What are the effects on net income from these transactions

Reference no: EM13121069

On April 1, Quality Corporation, a U.S. company, expects to sell merchandise to a French customer in three months, denominating the transaction in euros. On April 1, the spot rate is $1.41 per euro, and Quality enters into a three-month forward contract cash flow hedge to sell 400,000 euros at a rate of $1.36. At the end of three months, the spot rate is $1.37 per euro, and Quality delivers the merchandise, collecting 400,000 euros. What are the effects on net income from these transactions?

Reference no: EM13121069

Questions Cloud

Description of mutually exclusive events : Can you give two other ways of representing a discrete probability distribution? Or Can a pair of events be both mutually exclusive and independent? Description of Mutually exclusive events

Problem related to manufacturing overhead : Manufacturing overhead is allocated at 130% of direct labor costs. Actual manufacturing overhead was $86,500, and jobs costing $225,000 were?

Personality development : Doctoral learner requires APA style for writing assignment. Support or debate the concept of innate good through the following lenses of personality development:

Explaination graph system of inequalities : A small home-based company produces both hand-painted scarves and sweaters. The scarves take 2 hours of labor to produce, and the sweaters take 14 hours.

What are the effects on net income from these transactions : On April 1, Quality Corporation, a U.S. company, expects to sell merchandise to a French customer in three months, denominating the transaction in euros. On April 1, the spot rate is $1.41 per euro.

Investment income and related expenses : Investment income and related expenses amount to $7,000 and $500, respectively. What is Mike and Sally's interest deduction for the 2010 tax year?

Find the probability of exactly two jackpots in five trials : Suppose that a guest claims that she played the slot machine 5 times and hit the jackpot twice. Find the probability of exactly 2 jackpots in 5 trials.

Inherent meaning and justification of cross multiplication : What is the inherent meaning and justification of cross multiplication as it applies to solving an equality? Is | x -2 | the same as | 2 - x |? Please explain your answer. How do you express the following mathematically?

What is the molarity of a solution : What is the molarity of a solution that contains 41.0 g of vitamin B1 hydrochloride (molar mass = 337 g/mol}) in 280 mL of solution?

User Account

All Pages