Question
In: Finance
An Omani dates dealer enters into a contract with Indian importer to deliver INR 100000 worth...
An Omani dates dealer enters into a contract with Indian
importer to deliver INR 100000 worth of dates on 1st May 2019
payment to be received within one month from the date of delivery.
The exchange rate in spot market on the date of transaction is INR
184.254 = 1 OMR. The dates were delivered on 1st June 2019.
Assuming that the forward contract price of INR is at a forward
discount of 5% for 1st July and the spot rate of INR is expected to
depreciate by 5% against OMR by July 2019.
a. .Find out the amount of OMR to be received by the dealer if
he goes for forward contract to exchange INR to OMR.
b. Find out the amount of OMR to be received by the dealer if
he goes for actual price in July
c. If the dealer has an option to sell the INR in July at 4 %
depreciated value of OMR from May spot rate with 6% premium, should
he accept the option. If he accepts the options find out the amount
of OMR received by him and the difference between option price and
actual price.
Solutions
jeff jeffy answered 1 year agoRelated Solutions
An Omani dates dealer enters into a contract with Indian importer to deliver INR 100000 worth...
An Omani dates dealer enters into a contract with
Indian importer to deliver INR 100000 worth of dates on 1st May
2019 payment to be received within one month from the date of
delivery. The exchange rate in spot market on the date of
transaction is INR 184.254 = 1 OMR. The dates were delivered on 1st
June 2019. Assuming that the forward contract price of INR is at a
forward discount of 5% for 1st July and the spot...
An exporter in India exports fruits to Oman enters into a contract with Omani importer to...
An exporter in India exports fruits to Oman enters
into a contract with Omani importer to deliver OMR 10000 worth of
fruits on 1st June 2019 payment to be received within one month
from the date of delivery. The exchange rate in spot market on the
date of transaction is INR 186.254 = 1 OMR. The fruits were
delivered on 1st July 2019. Assuming that the forward contract
price of INR/OMR is at a forward discount of 7% for 1st...
An exporter in India exports fruits to Oman enters into a contract with Omani importer to...
An exporter in India exports fruits to Oman enters into a
contract with Omani importer to
deliver OMR 10000 worth of fruits on 1st June 2019 payment to
be received within one month
from the date of delivery. The exchange rate in spot market on
the date of transaction is INR
186.254 = 1 OMR. The fruits were delivered on 1st July 2019.
Assuming that the forward
contract price of INR/OMR is at a forward discount of 7% for
1st...
An importer in India imports minerals from Oman enters into a contract with Omani exporter to...
An importer in India imports minerals from Oman enters into a
contract with Omani exporter to deliver OMR 20000 worth of minerals
on 1st September 2019 payment to be received within one month from
the date of delivery. The exchange rate in spot market on the date
of transaction is OMR0.00555=1 INR. The minerals were delivered on
1st November 2019. Assuming that the forward contract price of
OMR/INR is at a forward discount of 8% for 1st December and the...
An Omani car dealer enters into a contract with German manufacturing company for purchase of 25...
An Omani car dealer enters into a contract with German
manufacturing company for purchase of 25 cars on 1st February 2019
payment to be made within one month from the date of delivery. The
exchange rate in spot market on the date of transaction is OMR
0.43556 = 1 EUR. The total cost of 25 cars amounts to Euro 625000.
The car was delivered on 1st June 2019. Assuming that the forward
contract price of OMR is at a forward...
An Australian importer has received goods from India and will pay 2 million Indian rupees (INR)...
An Australian importer has received goods from India and will
pay 2 million Indian rupees (INR) in one year. The importer expects
that the value of the INR will appreciate by 20.57% against the
Australian dollar from today’s spot rate of 0.2527 in one year. How
much Australian dollar the importer will make a loss due to
appreciation of INR after one year? (enter the whole number with no
sign or symbol)
Boris Company enters into a contract with Bella Company to manufacture, deliver, and install a specially...
Boris Company enters into a contract with Bella Company to
manufacture, deliver, and install a specially made piece of
machinery. The total contract price is $10,000,000. The contract
provides that $5,000,000 must be paid to Boris when the machine is
delivered and $5,000,000 must be paid when installation is
complete. The junior accountant properly concluded that delivery of
the manufactured machine and installation of the machine represent
two separate performance obligations. The accountant properly
allocated $1,000,000 of the contract price...
Boris Company enters into a contract with Bella Company to manufacture, deliver, and install a specially...
Boris Company enters into a contract with Bella Company to
manufacture, deliver, and install a specially made piece of
machinery. The total contract price is $10,000,000. The contract
provides that $5,000,000 must be paid to Boris when the machine is
delivered and $5,000,000 must be paid when installation is
complete. The junior accountant properly concluded that delivery of
the manufactured machine and installation of the machine represent
two separate performance obligations. The accountant properly
allocated $1,000,000 of the contract price...
On January 1, 2019, Fulton Inc. enters into a contract with Gibson to deliver goods. Gibson...
On January 1, 2019, Fulton Inc. enters into a contract with
Gibson to deliver goods. Gibson pays $100,000 at the time the
contract is signed, at which time the goods are transferred and
Fulton’s performance obligation is complete. In addition, Gibson
agrees to pay Fulton $100,000 on December 31, 2019, and December
31, 2020. If Fulton entered into a financing arrangement with
Gibson it would charge an interest rate of 9%.
Required:
1.
Determine the transaction price for the contract...
On January 1, 2017, Fulton Inc. enters into a contract with Gibson to deliver goods. Gibson...
On January 1, 2017, Fulton Inc. enters into a contract with
Gibson to deliver goods. Gibson pays $100,000 at the time the
contract is signed, at which time the goods are transferred and
Fulton’s performance obligation is complete. In addition, Gibson
agrees to pay Fulton $100,000 on December 31, 2017, and December
31, 2018. If Fulton entered into a financing arrangement with
Gibson it would charge an interest rate of 9%.
Required:
1. Determine the transaction price for the contract...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- At the end of 2018, Terry Company prepared the following schedule of investments in available-for-sale debt...
- Welcome Inc. is a chain of fast-food restaurants located in major metropolitan areas in the South....
- A 16 g ball is fired horizontally with speed v0 toward a 111 g ball hanging...
- 1. Read the following case and answer the related questions: Nike is the largest seller of...
- do small companies that manufacture only a small handful of products need to be concerned with...
- Assume that the mean of the engineered part is 79.95 and standard deviation of 0.017291, with...
- Case Study -ZaraManufacturing doesn’t get much older than the textile and clothing industry. Since the earliest...
ADVERTISEMENT