User Account

All Pages

What the future dollar cost of meeting this obligation

Assignment Help Accounting Basics
Reference no: EM133023052

Question - XYZ Corporation, located in the United States, has an accounts payable obligation of ¥652 million payable in one year to a bank in Tokyo. The current spot rate USDJPY = 105.27 and the one year forward rate is 104.84. The annual interest rate is 1.3 percent in Japan and 2.6 percent in the United States. XYZ can also buy a one-year call option on yen at the strike price of $0.0093 per yen for a premium of 0.031 cent per yen. Assume that the forward rate is the best predictor of the future spot rate. What the future dollar cost of meeting this obligation using the option hedge?

Reference no: EM133023052

Questions Cloud

What is difference between accounting income and cash flow : Question - What is the difference between accounting income and cash flow? AND give an example. How do we determine a firm's cash flows
Companies are using a differentiation strategy : Your boss, Penny Dirks, has asked you to analyze the airline industry using Porter's three generic strategies. Which of the following companies are using a diff
Did your life coach provide the appropriate service : Did your Life Coach provide the appropriate service? -What are your significant experiences when you approached and talked to your Life Coach
Initial portfolio selection report of tesla : Help me with an outline for the Initial Portfolio Selection Report of TESLA, Inc. (TSLA) and UnitedHealth Group
What the future dollar cost of meeting this obligation : Assume that the forward rate is the best predictor of the future spot rate. What the future dollar cost of meeting this obligation using the option hedge
Is there a need for gender-specific programming : Can generic rehabilitation programs be adapted to meet the needs of various offender populations (i.e., males, females, sex offenders, mental health, etc.)?
Calculate the no-arbitrage price : The current spot rate is $1.3077. Calculate the no-arbitrage price at which you could enter into a forward contract that expires in 60 days
Crisis response to active shooter situations : Crisis response to active shooter situations A thesis statement would include a statement of the problem along with statistics or some other method
What is the Operating Margin : What is the Operating Margin? (in percent) - operating margin is a measure of the level of profitability experienced in a firm's operations

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd