Currency Hedging at Aifs

3. Identify all costs, other than variable costs, for the trade show distribution strategy. Categorize these costs as investments and fixed costs (per trade show and for fiscal 2005).

Compute the projected profit for the order quantities suggested by the management team under three scenarios: worst case in which sales = 10,000 units, most likely case in which sales = 20,000 units, and best case in which sales = 30,000 units.

1. For financial accounting purposes, what is the total amount of product costs incurred to make 10,000 units?

The derivatives program was reducing risk when the firm was investing in foreign currency futures for the first four months from the implementation date (February 1991 to May 1991). This is seen by the negative correlation of (0.94226594) between the derivative (futures) cash flow and the unhedged cash flow. A purpose of a perfect hedge is to obtain a net of zero or in other words, reduce your risk to nothing not including the cost of the hedge. If a correlation is negative, as it was for the first three

In our second assumption, instead of using the cost of goods per cases in 1986, we try to use the percentage it counts in the total expenses which is 50.4% and to find the sales needed to break-even. The detail of the calculation is shown in the answer for questions d. The result is that 95,635, a little bit higher than the estimated sales of 90,000.

The amount of extra sales that would be required to cover this cost of 300,000 would be

First of all I have to calculate the portion that the intracompany sales cover of the fixed costs.

8. Using the ABC data, compute the average contribution to profit per account for both retail and business customers. What business strategy would be a manager using the ABC cost system likely adopt? How does this result compare to your response to Requirement 1, Part E?

The $320,000, on the other hand, is a fixed cost associated with the proposed addition.

The gross profit margin for each product produced based on the ABC data can be determined by the selling price minus the ABC cost per unit multiplied by the units produced (Edmonds, Tsay, & Olds, 2011). Product GS-157, selling price per unit $19.30 minus ABC cost per unit $12.50 equals $6.80 multiplied by the units produced 120,000 equals the ABC gross profit margin $816,000 (Edmonds, Tsay, & Olds, 2011). Product HS-241, selling price per unit $17.50 minus ABC cost per unit $11.67 equals $5.83 multiplied by the units produced 90,000 equals the ABC gross profit margin $525,000 (Edmonds, Tsay, & Olds, 2011). Product OS-367. Selling price per unit $15.10 minus ABC cost per unit $13.75 equals $1.35 multiplied by the units produced 40,000 equals

PROBLEM 15.50 (40 minutes) Customer profitability analysis: manufacturer 1 Customer profitability analysis: Sales revenue Cost of goods sold Gross margin Selling and administrative costs: General selling costs General administrative costs Customer-related costs: Sales activity (8,6 x $1000) Order taking (15, 20 x $200) Special handling (800, 600 x $50) Special shipping (18, 20 x $500) Total selling and administrative costs Operating profit CaesarStream $190 000 80 000 110 000 24 000 19 000 8 000 3 000 40 000 9 000 $103 000 $ 7 000 NeroCom $123 800 62 000 61 800 18 000 16 000 6 000 4 000 30 000 10 000 $84 000 ( $22 200)

a. Assuming the most current operational cost levels, what sales must it generate to recoup the above investment?

Solen Company 's break-even point in sales is $900,000, and its variable expenses are 75% of sales. If the company lost $32,000 last year, sales must have amounted to:

12000 daily sales) Particulars Year 1 Gross Revenues 43,20,000 Gross Expenditure [A+B] 29,80,800 Earnings Before Interest, Depreciation and 13,39,200 Taxes Cashflows (Estimated by us assuming Rs. 15000 daily sales) Particulars Year 1

This equation is solved for the sales volume in units. c. In the graphical approach, sales revenue and total expenses are graphed. The break-even point occurs at the intersection of the total revenue and total expense lines. 8-2 The term unit contribution margin refers to the contribution that