- 5 Marks
FM – NOV 2015 – L2 – Q5b – Foreign exchange risk and currency risk management
Calculate the profit or loss on a foreign exchange transaction involving the import of musical instruments by Skytrain.
Question
b. Skytrain, a music production company, imported musical instruments from Sweden for Krona 2,100,000 at a rate of Krona 7.00 to GH₵1.00. Skytrain sold the goods for GH₵600,000 after paying shipping cost of GH₵50,000 and bank transfer charges of GH₵5,000 and Krona 10,000. At the time of paying the bank charges, the Krona was traded at 5 to GH₵1.00.
Required:
Calculate the profit or loss on this transaction. (5 marks)
Find Related Questions by Tags, levels, etc.
- Tags: Foreign Exchange, Import Costs, Profit Calculation
- Level: Level 2
- Topic: Foreign exchange risk and currency risk management
- Series: NOV 2015
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