Homework Answers
Embedded in the term structure of interest rates is the market's expectation of interest rates going forward.
The market's expectation of the 117 day interest 233 days from now, r, is calculated as follows:
1.0244^(233/360) * (1+r)^(117/260) = 1.0267^(350/360)
r= 3.13%
Therefore present value of this transaction = ((-3.13+2.33)*(117/360)*3000000/100) / (1.0267^(350/360))
= - USD 7602.72
Since the expected deposit rate after 233 days is higher than what is being locked in right now, the NPV is negative for this transaction
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Question 2 10 pts You are depositing $3m from the bank starting in 233 days and...
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Please give a thorough explanation, thank you!
You are running a bank and a customer wants to deposit $10m into the bank starting in 244 days and ending in 366 days. You will pay interest on an ACT/360 basis and will set the rate at 0.40% below fair. Interest rates are: Days Cont. Comp. Rates 244 3.01 366 3.65 What rate do you charge? Give your rate to 2 decimal places and enter 3.05% as 3.05.
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2) prepare the T-accounts. To complete the journal entries, do not forget that you need to...
2) prepare the T-accounts. To complete the journal
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3) The last tab in the Excel template is for you to
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4) The last step of the project is to make the closing
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Question 8 For each of the following independent situations and from the information below record the...
Question 8 For each of the following independent situations and from the information below record the adjusting entry (and only the adjusting entry – do not record the original transaction or opening balance) in the General Journal, being as precise with your account titles as possible, e.g. not using “supplies” but “supplies expense” or “supplies on hand”. Please ignore GST. All calculations are to be worked out on a monthly (not daily) basis. Note: alternative versions of some of the...
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Question 8 For each of the following independent situations and from the information below record the adjusting entry (and only the adjusting entry – do not record the original transaction or opening balance) in the General Journal, being as precise with your account titles as possible, e.g. not using “supplies” but “supplies expense” or “supplies on hand”. Please ignore GST. All calculations are to be worked out on a monthly (not daily) basis. Note: alternative versions of some of the...
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Please give a thorough explanation, thank you!
You are running a bank and a customer wants to deposit $10m into the bank starting in 244 days and ending in 366 days. You will pay interest on an ACT/360 basis and will set the rate at 0.40% below fair. Interest rates are: Days Cont. Comp. Rates 244 3.01 366 3.65 What rate do you charge? Give your rate to 2 decimal places and enter 3.05% as 3.05.
Question 4 20 pts A company approaches a bank and wants to deposit $7m from the bank starting in 175 days for 90 days. The bank sees the current market information as • 175 day continuously compounded rate is 3.8671%. • There is a Eurodollar futures contract expiring in 175 days with a price of 96.3491. The bank sets their deposit rate at 0.3% below fair. At what rate does the bank set its rate? % (solve to 4 decimal...
Hell with these three questions please.
10. Uneven cash flows Aa Aa E A series of cash flows may not always necessarily be an annuity. Cash flows can also be uneven and variable in amount, but the concept of the time value of money will continue to apply. Consider the following case: The Purple Lion Beverage Company expects the following cash flows from its manufacturing plant in Palau over the next five years: Year 1 $250,000 Annual Cash Flows Year...
Can you help me from question 2 to question 10 please?
TRANSACTIONS This should match the last 5 digits of July $XX XXX of common shares in the new company are sold for cash. Purchased land and building, worth $120,000 and $240,000 respectively by borrowing all the funds from the bank on a long-term loan. Paid $10,800 for the premium on a one-year insurance policy effective today. Purchased $5,600 of office supplies for cash. Paid an employee $1,800 for two...
2) prepare the T-accounts. To complete the journal
entries, do not forget that you need to make the adjusting entries
per the descriptions of transactions in the project
document.
3) The last tab in the Excel template is for you to
prepare the unadjusted trial balance, as well as the adjusted trial
balance. Note that you need to enter all the adjustments in the
worksheet.
4) The last step of the project is to make the closing
entries. You shall...
& Comp10-1 (similar to) E Question Help Colin Cameron Appliance-Nantucket has just purchased a franchise from Colin Cameron Appliance (CCA). Click the icon to view the additional information) Following is the chart of accounts for Colin Cameron Appliance-Nantucket. As a new business, all beginning balances are SO. Colin Cameron Appliance-Nantucket completed the following transactions during 2018, its first year of operations: i (Click the icon to view the transactions ) Read the requirements. (Click the icon to view the chart...
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