Pro forma income statement, in won (millions) sales (1,000,000 @ 5,000 won/set)............. 5,000 costs..............................................................(4,000) labor-skilled....................................(1,700) raw materials: imported (duty-free)......................(1,000) local.................................................(500) overhead..........................................(300) interest.............................................(500) profit (before tax) 10%........................1,000 If the won devalues, from w484/$ (won per dollar) to w580/$, recompute ALL VALUES on the statement with the new exchange rate. Assume domestic sales remain the same.
Pro forma income statement, in won (millions) sales (1,000,000 @ 5,000 won/set)............. 5,000 costs..............................................................(4,000) labor-skilled....................................(1,700) raw materials: imported (duty-free)......................(1,000) local.................................................(500) overhead..........................................(300) interest.............................................(500) profit (before tax) 10%........................1,000 If the won devalues, from w484/$ (won per dollar) to w580/$, recompute ALL VALUES on the statement with the new exchange rate. Assume domestic sales remain the same.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Pro forma income statement, in won (millions)
sales (1,000,000 @ 5,000 won/set)............. 5,000
costs..............................................................(4,000)
labor-skilled....................................(1,700)
raw materials:
imported (duty-free)......................(1,000)
local.................................................(500)
overhead..........................................(300)
interest.............................................(500)
profit (before tax) 10%........................1,000
If the won devalues, from w484/$ (won per dollar) to w580/$, recompute ALL VALUES on the statement with the new exchange rate. Assume domestic sales remain the same.
Transcribed Image Text:Pro forma income statement, in won (millions)
sales (1,000,000 @ 5,000 won/set). . 5,000
costs....
.(4,000)
labor-skilled...
.(1,700)
raw materials:
imported (duty-free)...
..(1,000)
local..
.(500)
overhead..
(300)
interest.
.(500)
profit (before tax) 10%...
.1,000
if the won devalues, from w484/$ to w580/$, recompute the statement assuming domestic
sales remain the same
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