An Australian exporting company will receive 4m USD in 6 months’ time from sales. The current spot rate is: AUD / USD 0.7066 / 0.7073. Australian interest rates are currently at 1.5% p.a. and U.S. interest rates are at 0.5% p.a. The net interest rate spread in both countries is 3.5% (read this as the borrowing rates are 3.5% higher than the given investment rates above). Design a money market hedge which will remove the FX risk faced by the company, yet not altering the timing of the payment. Clearly show the AUD cash flow in the future.

Explain the business activities and environment of Ford Motor Company from the perspective of foreign currency and identify three currencies that Ford Motor Company is exposed against. This can be due to its business structure (i.g. location of factories, customers and suppliers, and the currency that the products/services are quoted), and arising from the competition against its rivals. State the rationales of your selection and references. You need to make exchange rate forecasts, and show how sensitive the company’s value is against the change in the value of the foreign currencies that you have selected against the U.S. dollar.

Shown below are exchange rates for several currencies.  

A U.S. company purchases goods from several foreign companies with payment due in euros, francs, and pesos.  Would the company be better off paying any of the suppliers now or should it wait 60 days? Why?

The SEC 10-K assignment will consist of research and the completion of a paper on select areas of an annual SEC 10-K report filed by a public company with the U.S. Securities and Exchange Commission (SEC). The focus of this assignment is on the disclosure issues related to the segment information in the SEC 10-K.

Question and instructions ---- I selected a company Intel. Please write a 3 pages report on the recent SEC 10-K report. You will have to go on https://www.sec.gov and check the most recent repot of Intel. You can write it in 3 days.

Various factors or forces impact a company’s decision to go into a foreign market and affect the outcome of that decision. If a country or market has several factors in common with the original market, or with the other markets selected when choosing several markets, it will be easier to enter that market.

• If a U.S. software company that primarily creates and sells educational software wants to expand into two foreign markets, what factor commonalities (as found in your Learning Activities) should the company be looking for when deciding on the two countries?
• Provide two country suggestions and explain your reasoning.

If the British pound depreciates against the U.S. dollar

Select one:

British businesses gain by an increase in the dollar price of British exports to the United States.

British consumers lose by an increase in the pound price of U.S. exports to Britain.

British consumers gain by a decrease in the pound price of U.S. exports to Britain.

U.S. consumers lose by an increase in the dollar price of British exports to the United States.

consider the long-run impact of the increase in saving by American families, and consider the U.S. as an open economy with international trade and international capital flows. As before, assume that there is no policy response to the increased saving by American families. What would be the long run impact of the increased saving on the U.S. interest rate, on the value of the U.S. dollar, and on U.S. net exports? Explain. (use the IS-LM and AS-AD logic to answer)

Which of the following is not a concern regarding IFRS adoption by the U.S.?

Multiple Choice

• Need for the U.S. to have strong influence on the standard-setting process and ensure that standards meet U.S. needs.

• Geographic dispersion of standard setters make it unlikely that boards can interact to achieve consensus.

• The high costs to companies of converting to IFRS.

• The fact that many laws, regulations and private contracts reference U.S. GAAP.

1. The U.S. Export-Import Bank (ExImbank), which promotes U.S. exports through loan guarantees and insurance programs, has been criticized for favoring corporate interests ahead of the interests of U.S. taxpayers. Should taxpayers be supporting the exports of large U.S. MNEs?

2. Is it appropriate for MNEs to establish operations abroad solely for the purpose of avoiding taxation?

Please discuss your thoughts and comments.

Green Landscaping Inc. is preparing its budget for the first quarter of 2020. The next step in the budgeting process is to prepare a cash receipts schedule and a cash payments schedule. To that end the following information has been collected. Prepare schedules for cash receipts and cash payments, and determine ending balances for balance sheet. Clients usually pay 60% of their fee in the month that service is performed, 30% the month after, and 10% the second month after receiving service. Actual service revenue for 2019 and expected service revenues for 2020 are November 2019, $80,000; December 2019, $90,000; January 2020, $100,000; February 2020, $120,000; and March 2020, $140,000. Purchases of landscaping supplies (direct materials) are paid 60% in the month of purchase and 40% the following month. Actual purchases for 2019 and expected purchases for 2020 are December 2019, $14,000; January 2020, $12,000; February 2020, $15,000; and March 2020, $18,000.

Instructions a. Prepare the following schedules for each month in the first quarter of 2020 and for the quarter in total:

1. Expected collections from clients.

2. Expected payments for landscaping supplies.

b. Determine the following balances at March 31, 2020:

1. Accounts receivable.

2. Accounts payable.