Company ABX in Toronto is shipping 1050 units of computers to South Korea. Each computer is priced at $600 CND. Trucking charges is 1000 CND to Montreal and Ocean freight: $ 12,500.00 USD. They would like to add insurance coverage of 115%. They have been offered a rate of 0.05% for insurance. Insurance premium?

Company ABX in Toronto is shipping 1050 units of computers to South Korea. Each computer is priced at $600 CND. Trucking charges is 1000 CND to Montreal and Ocean freight: $ 12,500.00 USD. They would like to add insurance coverage of 115%. They have been offered a rate of 0.05% for insurance. Insurance premium?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter27: Multinational Financial Management

Section: Chapter Questions

Problem 11P: Boisjoly Watch Imports has agreed to purchase 15,000 Swiss watches for 1 million francs at today’s...

See similar textbooks

Similar questions

Kristo Asafo Tools Ltd is filling an order from a Korean industrial company for machinery worth 160,000,000 Won. The export sale is denominated in Korean Won and is on a one-year open account basis. The opportunity cost of funds for Kristo Asafo Tools Ltd is 8% The Current spot rate between Won and Dollars is 800 Won/$. The forward Won sells at a discount of 12% per annum, but the finance staff of Kristo Asafo Tools Believes that the Won will drop only 9% in value over the next year. Kristo Asafo Tools Ltd faces the following choices This question compares the cost of a money market hedge with a forward hedge, and considers both alternatives against the possibility of remaining unhedged. a) Wait one year to receive the won amount and exchange Won for dollars at that time b) Sell the Won proceeds of the sale forward today c) Borrow Won from a Seoul bond at 20% per annum against the expected future receipt of the Korean importer’s payment d) What do you recommend and why?
The Warren W. Fisher Computer Corporation purchases 8,000 transistors each year as components inminicomputers. The unit cost of each transistor is $10, and the cost of carrying one transistor in inventoryfor a year is $3. Ordering cost is $30 per order and finds that deliveries from his supplier generally take 5working days. What are?(a) the optimal order quantity.(b) the expected number of orders placed each year.(c) the expected time between orders? Assume that Fisher operates on a 200-day working year.(d) the reorder point for the transistors.
Philippine Airlines (PAL) plans to offer several new electronic services on flights between Manila and selected Asian destinations. The marketing director estimates that for a typical 24-hour period there is a 55% chance of having a net cash flow of P40,000 and a 25% chance of P95,000. He also estimates there is a small 5% chance of no cash flow and a 15% chance of a loss of P16,000, which is the estimated extra personnel and utility costs to offer the services. Determine the expected net cash flow.
Bulldogs Inc. currently fills mail orders from all over the country and receipts were received in its head office. The company’s average accounts receivable is P3,125,000 and is financed by a bank loan with 10% interest. Bulldogs is considering a regional lockbox system to speed up collections. This system is projected to reduce the average accounts receivable by 15%. The annual cost of the lockbox system is P25,000. What is the estimated net annual savings in implementing the lockbox system? P22,985 P25,750 P28,455 P21,875
One of your Taiwanese suppliers has bid on a new line of molded plastic parts that is currently being assembled at your plant. The supplier has bid $0.10 per part, given a forecast you provided of 200,000 parts in year 1; 300,000 in year 2; and 500,000 in year 3. Shipping and handling of parts from the supplier’s factory is estimated at $0.01 per unit. Additional inventory handling charges should amount to $0.005 per unit. Finally,administrative costs are estimated at $20 per month. Although your plant is able to continue producing the part, the plant would need to invest in another molding machine, which would cost $10,000. Direct materials can be purchased for $0.05 per unit. Direct labor is estimated at $0.03 per unit plus a 50 percent surcharge for benefits; indirect labor is estimated at $0.011 per unit plus 50 percent benefits. Up-front engineering and design costs will amount to $30,000. Finally, management has insisted that overhead be allocated if the parts are made in-house…
Smith Inc. currently fills mail orders from all over the country and receipts were received in its head office. The company's average accounts receivable is P3,125,000 and is financed by a bank loan with 10% interest. Smith is considering a regional lockbox system to speed up collections. This system is projected to reduce the average accounts receivable by 15%. The annual cost of the lockbox system is P25,000. What is the estimated net annual savings in implementing the lockbox system? A. 22,985 B. 28,455 C. 25,750 D. 21,875
Bulldogs Inc. currently fills mail orders from all over the country and receipts were received in its head office. The company’s average accounts receivable is P3,125,000 and is financed by a bank loan with 10% interest. Bulldogs is considering a regional lockbox system to speed up collections. This system is projected to reduce the average accounts receivable by 15%. The annual cost of the lockbox system is P25,000. What is the estimated net annual savings in implementing the lockbox system? A. P25,750 B. P21,875 C. P22,985 D. P28,455
War room has contracted with a local university to replace the entire inventory (1,000) of computers and monitors with the Super Zoom 1000, 48" monitors, along with keyboard and mouse for $1,177,200. This is a 10% discount for a large contract purchase. The contract states all the computers must be installed within 60 days and payments will be Net 60 after installation. Problem: 1. How much will it cost to purchase a large order from the vendors? 2. Does Zoom Computers have the cash flow to make the purchase? 3. How much cash flow will Zoom Computers need to survive 120 days? 4. What recommendations would you offer to the owners of Zoom Computers for raising capital if needed? Need answer for all . Please do not give incomplete or incorrect answer with explanation computation formulation with steps so that I can better understand . Thanks for your help
Davao has a potential foreign customer that has offered to buy 1,500 tons at P450 per ton. Assume that all of Davao’s costs would be at the same levels and rates as last year. What net income after taxes would Davao make if it took this order and rejected some business from regular customers so as not to exceed capacity? If the sales volume is estimated to be 2,100 tons in the next year, and if the prices and costs stay at the same levels and amounts next year, the after-tax income that Davao can expect for next year is? Assume that Davao plans to market its product in a new territory. Davao estimates that an advertising and promotion program costing P61,500 annually would need to be undertaken for the next two or three years. In addition, a P25 per ton sales commission over and above the current commission to the sales force in the new territory would be required. How many tons would have to be sold in the new territory to maintain Davao’s current after-tax income of P94,500?
Inc. currently fills mail orders from all over the country and receipts were received in its head office. The company’s average accounts receivable is P3,125,000 and is financed by a bank loan with 10% interest. Inc. is considering a regional lockbox system to speed up collections. This system is projected to reduce the average accounts receivable by 15%. The annual cost of the lockbox system is P25,000. What is the estimated net annual savings in implementing the lockbox system? P28,455P22,985P25,750P21,875
Davao has a potential foreign customer that has offered to buy 1,500 tons atP450 per ton. Assume that all of Davao’s costs would be at the same levels and rates as last year. What net income after taxes would Davao make if it took this order and rejected some business from regular customers so as not to exceed capacity?
(i) Electronics Ltd manufactures air conditioners. It purchases 200,000 units of a particular type of compressor part, CU30, each year at a cost of $64 per unit. Annual carrying cost (for insurance, material handling, breakage etc) per unit is 5% of the unit purchase price. Currently Electronics Ltd places 50 orders for 4,000 units each year and ordering costs per purchase order are $18. d) Calculate the EOQ.e) What is the minimum ordering cost?f) What is the minimum storage cost?