Cement.

siam cement, the bangkok-based cement manufacturer, suffered enormous losses with the coming of the asian crisis in 1997. the company had been pursuing a very aggressive growth strategy in the mid-1990s, taking on massive quantities of foreign-currency-denominated debt (primarily u. s. dollars). when the thai baht (b) was devalued from its pegged rate of

b25.925.9 /$

in july 1997, siam's interest payments alone were over $900 million on its outstanding dollar debt (with an average interest rate of

8.268.26 %

on its u. s. dollar debt at that time). assuming siam cement took out

$ 47$47

million in debt in june 1997 at

8.268.26 %

interest, and had to repay it in one year when the spot exchange rate had stabilized at

upper b 42.3 divided by $b42.3/$ ,

what was the foreign exchange loss incurred on the transaction?

the amount of the foreign exchange loss incurred on the transaction is? ? )

P8-4b dropping unfavorable division based on the following analysis of last year's operations of groves, inc., a financial vice president of the company believes that the firm's total net income could be increased by $160,000 if its design division were discontinued. (amounts are given in the thousands of dollars.) required provide answers for each of the following independent situations: a. assuming that total fixed costs and expenses would not be affected by discontinuing the design division, prepare an analysis showing why you agree or disagree with the vice president. b. assume that the discontinuance of the design division will enable the company to avoid 30% of the fixed portion of cost of services and 40% of the fixed operating expenses allocated to the design division. calculate the resulting effect on net income. c. assume that in addition to the cost avoidance in requirement (b), the capacity released by discontinuance of the design division can be used to provide 6,000 new services that would have a variable cost per service of $60 and would require additional fixed costs totaling $68,000. at what unit price must the new service be sold if groves is to increase its total net income by $180,000?