Stoneleigh Limited, a UK manufacturing company, has just signed a contract on 1st June 2018 to import $1,000,000 of raw materials from a US company. The payment is due in three months’ time. The board of Stoneleigh Limited expect a steep depreciation of Sterling against $, hence they are considering two alternative ways to hedge their exposure. 1) A forward hedge 2) A futures hedge Market Data at 1st June 2018: Exchange rates: Spot $1.30/£ 3-month Forward $1.28/£ Currency futures: CME £62,500 September 2018 Contract (cash-settled): $1.26/£ Interest rates (borrowing and lending): UK 4% per annum US 2% per annum Required: a) Evaluate the outcome of the two alternative hedging methods in 3 months’ time if exchange rates have moved to: i) $1.24/£ [10 marks] iii) $1.36/£ [10 marks] Your answer should include both a numerical and a written summary and evaluation. b) The company’s financial manager also proposes the use of money market hedging, i. e. a synthetic forward. i) Explain how the company would use a money market hedge based on the above market data. [10 marks] ii) Calculate the effective exchange rate and evaluate the outcome against your answer in a).

(blank) is the type of competition that occurs in a competitive market without identical producers.

Lo.2, 3, 9 lori, who is single, purchased 5-years class property for $200,00 and 7-years class property for $420,000 on may 20, 2018. lori experts the taxable income derived form the business (without regard to the amount expensed under ⧠179) to be about $550,000. lori has determined that she should elect immediate ⧠179 expensing in the amount of $520,000, but she doesn’t know which asset she should completely expense under ⧠179. she does not claim any available additional first-year depreciation. a. determine lori’s total cost recovery deduction if the ⧠179 expense is first taken with respect to the 5-year class asset. b. determine lori’s total cost recovery deduction if the ⧠179 expense is first taken with respect to the 7-year class asset. c. what is your advice for lori? d. assume that lori is in the 24% marginal tax bracket and that she uses ⧠179 on the 7-year asset. determine the present value of the tax savings from the depreciation deductions for both assets. see appendix g for present value factors, and assume a 6% discount rate. e. assume the same facts as in part (d), except that lori decides not to use ⧠179 on either asset. determine the present value of the tax savings under this choice. in addition, determine which option lori should choose. f. present your solution to parts (d) and (e) of the problem in a spreadsheet using appropriate microsoft excel formulas. e-mail your spreadsheet to your instructor with a two-paragraph summary of your findings.

Match the items with the actions necessary to reconcile the bank statement.(there's not just one answer)1. interest credited in bank account2. fee charged by bank for returned check3. checks issued but not deposited4. deposits yet to be crediteda. add to bank statementb. deduct from bank statementc. add to personal statementd. deduct from personal statement