Financial Math Answers

(a) ABC Company Ltd purchased 5000 cocoa futures contract at a price of $150

per contract. As part of the contract, ABC was required to deposit $10 per

contract initially in their account with the maintenance margin set at $5 per

contract. If the price per contract falls to $142 overnight, what action will the

exchange require ABC to undertake?

b) Emmanuella purchased a put option on British pounds for $.06 per unit. The strike price

was $1.85, and the spot rate at the time the pound option was exercised was $1.69.

Assume there are 31,250 units in a British pound option. What was Emmanuella’s net

profit on the option?

c) Caleb sold a put option on Canadian dollars for $.05 per unit. The strike price was $.85,

and the spot rate at the time the option was exercised was $.92. Assume Caleb

immediately sold off the Canadian dollars received when the option was exercised. Also

assume that there are 50,000 units in a Canadian dollar option. What was Caleb’s net

profit on the put option?

Ghana’s inflation is forecasted to be 10.2% over the coming year whilst that of South

Africa is forecasted to be 6.5%. The current exchange rate between Ghana Cedi and the

South African Rand is 0.32 ZAR per 1 GHS.

a) How should we quote the exchange rate between Ghana Cedi and the South

African Rand (ZAR) in a year’s time to avoid arbitrage?

b) A Ghanaian company is importing goods worth ZAR 20m in a year’s time, how

much GHS will the company require to import the goods?

c) If the actual rate at the end of the year is 0.35 ZAR per 1GHS, what is the

absolute forecast error for the forecast in (a)?

Mahesh wants to start his business and for that he decides that he will take loan for

Rupees 7 Lakhs from the Bank of Baroda. He also decides to use his saving worth 3 lakhs

in the bank account to start the business. Discuss how these two transactions will be

recorded in the books of accounts by passing the relevant journal entries? How these

transactions will be reflected in the Books of accounts (that’ is in the financial statements)?

Lastly, conclude your answer by stating the applicability of which accounting

assumption/s you did the above mentioned accounting treatment/ recognition and

presentation in the books of accounts.

"Please Only Give Me The Reference Of The Answer"

Take Britannia Industries Ltd as a case. In the context of its financial statements and

annual report answer the following

a. It’s a largely acceptable practice among the corporate entities to pay dividend to its

shareholders. Take Britannia Industries Ltd as a case. Discuss and differentiate the

types of dividend the company paid for the financial year 2020-2021. Also, mention

your understanding about what could be the accounting treatment of Dividend in the

books of Britannia Industries Ltd.

b. Discuss and share your understanding on any three profitability ratios which you feel

relevant to assess the profitability of the company. "I WANT TWO PAGE ANSWER"

Mahesh wants to start his business and for that he decides that he will take loan for

Rupees 7 Lakhs from the Bank of Baroda. He also decides to use his saving worth 3 lakhs

in the bank account to start the business. Discuss how these two transactions will be

recorded in the books of accounts by passing the relevant journal entries? How these

transactions will be reflected in the Books of accounts (that’ is in the financial statements)?

Lastly, conclude your answer by stating the applicability of which accounting

assumption/s you did the above mentioned accounting treatment/ recognition and

presentation in the books of accounts.

"PLEASE GIVE ME TWO PAGE ANSWER"

This pandemic situations has drawn the attention of a lot of individuals to actively watch

and participant in the Indian financial market. As a life-long learner, you also decide to

understand the fundamentals of certain companies listed on the stock exchanges in India.

One of your friends advised you to look in to the various techniques of financial analysis,

as one of the way of evaluating the financials of business entities. You are done with

getting an understanding about various techniques of financial analysis. Elaborate any five

of the said techniques for financial analysis.

"PLEASE GIVE ME TWO PAGE ANSWER"

Xolisile and Xolani are twins. To reward them for passing matric well, their parents gave them 

R20 000,00 each. Each one of them decided to invest three quarters of their money for a period of 

three years. Xolisile invested her money at a simple interest rate of 6,5% per annum. Xolani invested 

her money at an interest rate of 6,5% per annum, compounded annually. What is the difference 

between the values of the two investments at the end of the period?

Mr Mahlangu invests R20 000,00 to pay for lobola. After 48 months he receives R65 000,00. The 

interest on the investment is compounded quarterly. Determine the yearly interest rate at which the 

money was invested. Give your answer as a percentage, rounded to two decimal places.

Coupon rate: 9,75%

Yield to maturity: 11,4% per year

Maturity rate date: 15 April 2046

Settlement date: 29 November 2021

The accrued interest is