Currency hedging Alpha and Omega are U. S. corporations. Alpha has a plant in Hamburg that imports components from the United States, assembles them, and then sells the finished product in Germany. Omega is at the opposite extreme. It also has a plant in Hamburg, but it buys its raw material in Germany and exports its output back to the United States. How is each firm likely to be affected by a fall in the value of the euro? How could each firm hedge itself against exchange risk?

Vortex company operates a retail store with two departments. information about those departments follows. department a department b sales $ 800,000 $ 450,000 cost of goods sold 497,000 291,000 direct expenses salaries 125,000 88,000 insurance 20,000 10,000 utilities 24,000 14,000 depreciation 21,000 12,000 maintenance 7,000 5,000 the company also incurred the following indirect costs. salaries $36,000 insurance 6,000 depreciation 15,000 office expenses 50,000 indirect costs are allocated as follows: salaries on the basis of sales; insurance and depreciation on the basis of square footage; and office expenses on the basis of number of employees. additional information about the departments follows. department square footage number of employees a 28,000 75 b 12,000 50 required: 1. determine the departmental contribution to overhead and the departmental net income for department a and department b.