# Benjamin, Inc., operates an export/import business. The company has considerable dealings with companies in the country of Camerrand. The denomination of all transactions with these companies is alaries (AL), the Camerrand currency. During 2017, Benjamin acquires 20,000 widgets at a price of 8 alaries per widget. It will pay for them when it sells them. Currency exchange rates for 1 AL are as follows: September 1, 2017 \$0.46 December 1, 2017 0.44 December 31, 2017 0.48 March 1, 2018 0.45 Assume that Benjamin acquired the widgets on December 1, 2017, and made payment on March 1, 2018. What is the effect of the exchange rate fluctuations on reported income in 2017 and in 2018

2017 = (\$6,400)

2018 = \$4,800

Explanation:

The effect of the exchange rate fluctuations on reported income in 2017 and in 2018 is shown below:-

Particulars                               Amount

Purchased widgets                 20,000

Purchased price                       8

Total inventory                        160,000

(20,000 × 8)

Total inventory at Dec 1,2017 \$70,400

(160,000 × \$0.44)

Total inventory at Dec 31,2017 \$76,800

(160,000 × \$0.48)

Foreign exchange gain/(loss)

at reporting date                    (\$6,400)

(\$70,400  - \$76,800)

Total inventory at March 1, 2018 \$72,000

(160,000 × \$0.45)

Foreign exchange gain/(loss)

on March 1, 2018                         \$4,800

(\$76,800  - \$72,000)

So, the Foreign exchange loss in 2017 is (\$6,400) and the Foreign exchange gain in 2018 is \$4,800

## Related Questions

IIIYou have been asked to prepare the final accounts for
W Smith, a sole trader, for the year ended 31 December
2013. W Smith has forwarded to you all books of prime
entry and ledgers, and in addition has given you the
following information:
account to take his wife on holiday.
ii) Up to last year the machinery and vehicle used in
balance method. W Smith thinks that they should now
be depreciated using the straight-line method.
iii) Mr Smith is confident, given his order book that
the business will continue to operate in its present
form for many years.
iv) Mr Smith had purchased ten staplers, four flip
charts and four packets of whiteboard markers which
will be used in the business for the next couple of
years.
V)
Mr Smith informs you that he has just found an
unopened electricity bill for £900 which was for the
quarter October to December 2013
Required
In each case, identify and then explain the main
accounting concepts being highlighted and indicate
how each should be treated in the final accounts.​

## W Smith, a sole trader

Identification and Explanation of Highlighted Accounting Concepts and Treatment in the Final Accounts:

1. Economic Entity: The business (economic entity) is separate from the individual (W. Smith).  Accounts are kept to ensure this separation of ownership from the business.  This withdrawal is treated as Drawings, a reduction of capital (owner's equity) in the balance Sheet.

2. Consistency concept:  This concept requires that an accounting estimate or principle is consistently applied.  However, if there is a change in an accounting estimate, the effect of the change needs to be disclosed in the final accounts.

3. Going concern concept:  A business is assumed to continue indefinitely in life.  Therefore, assets and liabilities are stated at their cost or fair values.  Where there is a contrary view, this must be disclosed and accounts be kept to reflect the revised view.  Then, assets and liabilities will reflect market or disposal values.

4. Materiality concept:  This concept requires that values in accounts be material.  Though, materiality is a matter of judgement, a threshold can be established based on the value of the individual item to the value of the business.  Will its disclosure or not affect decisions of a knowledgeable investor or analyst, is a consideration under the materiality concept.  The office stationery can be expensed in the income statement if the amount involved is not material, even though, they will continue to be used in the business for more than a year.  This somehow contradicts the concept of the matching principle.

5. Accrual Concept:  The concept states that "Revenue is recognized when earned, and expenses are recognized when assets are consumed," and not when cash is received or paid.  This unpaid electricity bill for £900 must be accrued in the income statement as an expense and treated as a liability in the balance sheet in line with the accrual concept.

Explanation:

These are the basic accounting concepts:

1. Accruals concept

2. Conservatism concept

3. Consistency concept

4. Economic entity concept

5. Going concern concept

6. Matching concept

7. Materiality concept

Earnings available to common shareholders are defined as net profitsSelect one:a. after taxes.b. after taxes minus preferred dividends.c. after taxes minus common dividends.d. before taxes.

The correct answer is b. after taxes minus preferred dividends.

Explanation:

Net profit:Add all the revenues of the firm and deduct all the expenses of the firm. If the amount come in positive, the firm earns profit else suffered loss.

In mathematically,

Net profit = Sales revenue - all expenses

The earning which is available to shareholders is net profit after paying preference dividend to preference shareholders.

As first we have to pay the dividend to preference shareholders then we distribute the income to equity shareholders.

In mathematically,

EBIT - taxes - Preferred dividend

Hence, the correct option is b. After taxes minus preferred dividends.

Pearl, Inc., has offered \$422 million cash for all of the common stock in Jam Corporation. Based on recent market information, Jam is worth \$391 million as an independent operation. If the merger makes economic sense for Pearl, what is the minimum estimated value of the synergistic benefits from the merger? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567.)

Answer:Minimum Synergy gain = Purchase Price – Market Value Purchase Price \$357,000,000 – Market Value \$319,000,000 = \$38,000,000

Minimum estimated value of synergy would be \$38,000,000. With the merger, there would be a net gain from the synergy.

Explanation:

Mate i hope this helps sorry if im wrong

The minimum estimated value of the synergistic benefits from the merger between Pearl, Inc. and Jam Corporation is \$31 million. This value is calculated by subtracting the current worth of Jam Corporation (\$391 million) from the offer made by Pearl, Inc. (\$422 million).

### Explanation:

To calculate the minimum estimated value of the synergistic benefits from the merger, you would subtract the current value of Jam Corporation from the offer by Pearl, Inc. This is because the expected synergies are the value-add provided by the merger. In other words, if Pearl, Inc., is prepared to pay \$422 million for a company worth \$391 million, the difference between those two figures, or \$31 million, must be the value of the projected synergistic benefits that Pearl, Inc., hopes to realize as a result of the acquisition.

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What is the risk posture for each particular system as it contributes to the overall risk posture of the organization

Risk posture or cybersecurity posture is the general status or overall defense of the cybersecurity program in place in an organization to guard against cyber attacks and data breaches. For a company to maintain reasonable cyber security posture as there is no fool proof cybersecurity posture, there is need for regular continuous assessment of risk exposures and potential loopholes across the company's digital infrastructure. There are different digital and sophisticated infrastructures utilized by am organizations and most if not all are well prone to cyber attacks. These infrastructures are used by employees for work e. g-email, went servers, phones, networking devices and cloud programs etc . Therefore each employee must be educated in the need to safeguard company data by looking out for traps set by cyber attackers such as phishing in email and many other loopholes. Vulnerability tests need to be performed at regular intervals and reports monitored and analyzed to protect against a potential source of cyber attack.

Melissa sold some of her Bitcoin in 2021 for a \$200,000 long-term capital gain, bringing her total taxable income to \$450,000. What is the tax on this capital gain if she files her return as Head of Household?

Melissa's capital gain tax from the sale of her Bitcoin in 2021 for a long-term capital gain of \$200,000, and as Head of Household is \$30,000.

Data and Calculations:

Long-term capital gain = \$200,000

Total taxable income = \$450,000

Assumed long-term capital tax rate = 15%

Thus, the tax on Melissa's capital gain tax from the sale of her Bitcoin in 2021 for a long-term capital gain of \$200,000, and as Head of Household is \$30,000 (\$200,000 x 15%).

hi so im thinking its \$250,000 dollors probaly

Explanation:

What is the payback period for the following set of cash flows? (Round your answer to 2 decimal places, e.g., 32.16.) Year Cash Flow 0 –\$ 5,500 1 1,525 2 1,725 3 2,125 4 1,625

3.08 years

Explanation:

The computation of the payback period is shown below:

Year       Cash flows    Cumulative cash flows

0         -\$5,500                -\$5,500

1          \$1,525                 -\$3,975

2               \$1,725                -\$2,250

3               \$2,125                   -\$125

4               \$1,625                   \$1,500

Now the pay back period is

= 3 years + \$125 ÷ \$1,625

= 3.08 years

The payback period of the given cash flows is calculated by subtracting each year's cash inflow from the initial investment until the remaining amount is completely paid off. The payback period is found to be approximately 3.08 years.

### Explanation:

The Payback Period is a capital budgeting method that calculates the time required to recoup the cost of an investment. In your case, the cash flow starts with an investment of \$5,500 at Year 0, followed by cash inflows in subsequent years. Let's calculate the payback period in years.

• Year 1: \$5,500 - \$1,525 = \$3,975 remaining
• Year 2: \$3,975 - \$1,725 = \$2,250 remaining
• Year 3: \$2,250 - \$2,125 = \$125 remaining

At the end of Year 3, there is still \$125 remaining from the original investment that has not been recouped. We need a part of the Year 4 cash inflow to pay back the rest. Therefore, the payback period in years is: 3 + (\$125 / \$1,625) = 3.08 years.