Art Deco Architecture in the US the Dawn of Deco

African Of African American Culture - 1572 Words

There is no doubt that African Americans have a rich cultural background and history like the many different ethnic groups who settled in the New World, whose origins lie in another country. For this reason, America was known as the melting pot. However, the backgrounds of each of these cultures were not always understood or, in the case of African Americans, accepted among the New World society and culture. Americans were ignorant to the possibility of differences among groups of people until information and ideas started to emerge, particularly, the African retention theories. This sparked an interest in the field of African culture and retention in African Americans. However, the study of African American culture truly emerged as a result of increased awareness in America, specifically through the publication and findings of scholarly research and cultural events like the Harlem Renaissance where all ethnicities were able to see this rich historical culture of African Americans. There were many who became dedicated to this field of study, but two of the most predominant researchers and scholars of the African retention theories were Lorenzo Turner and Melville Herskovits. While both researchers examined different aspects of culture, Herskovits and Turner were both convinced that there was indeed African retention in African American culture and society (Wade-Lewis 402). Turner specifically researched linguistic retention, while Herskovits researched many aspects of theShow MoreRelatedAfrican American Culture in a Modern American Dominant Sociology2841 Words   |  12 PagesAfrican American Culture in a Modern American Dominant Sociology Intro to Sociology September 3, 2010 Janice Caparro African American culture in the United States refers to the cultural contributions of Americans African descent to the culture of the United States, either as part of or distinct from American culture. The distinct identity of African American culture is rooted in the historical experience of the African American people. The culture is both distinct and enormously influentialRead MoreAfrican American Vernacular Traditions: Integrated Into Modern Culture1292 Words   |  6 PagesAfrican American Vernacular Traditions: Integrated Into Modern Culture African American vernacular traditions have been around for many centuries and still cease to exist in their culture. The vernacular traditions of the African Americans started when slaves were existent in the eighteenth and nineteenth century. It is believed that the slaves spoke a mix of Creole and partial English, in which they had to create in order to communicate between them discreetly. The vernacular traditions originatedRead MoreThe Harlem Renaissance : An Influential Movement Of African American Culture1802 Words   |  8 Pagesfrom 1918 to 1937, and was the most influential movement of people of African American culture. It mostly involved literary, musical, theatrical, and visual arts. African Americans were trying to re-conceptualize white people’s outlooks on them as a whole. White people had plenty of stereotypes toward African Americans. They were racist toward them and had animosity toward them as well. White people always had African American people as slave s throughout history and even thought slavery was overRead MoreThe Meaning of Jazz in African American Culture Particularly in Harlem During the 1950’s2384 Words   |  10 PagesThe Meaning of Jazz in African American Culture Particularly in Harlem During the 1950’s In the Baldwin’s story, Sonny’s Blues, the author portrays African -Americans in the urban life. Even though he writes about reconciliation of two brothers, who are trying to overcome their differences and to come to understand each other, the story shows the meaning of Jazz in African American culture, particularly in Harlem during 1950. The urban life in Harlem has being described by many authors, includingRead MoreAfrican Americans And African American Culture953 Words   |  4 Pagesand perception of the African American culture. One common characteristic is that African Americans are much more likely to live in poverty and poverty stricken areas than White Americans (McNamara Burns, 2009). What I have learned it is not as simple as African Americans are poorer than White Americans. While the statement is true, it is simplistic. There are many reasons and. causes for the disparity in wealth and income between African Americans and White American. One explanation givenRead MoreAfrican Americans And African American Culture Essay1804 Words   |  8 Pagesblack America? African American culture in the United States has evolved continuously throughout United States history carrying on various cultural traditions of African ethnic groups brought here during slavery. The U.S. Census Bureau defines African Americ ans as a person having origins in any of the Black race groups of Africa.[1]. African American culture is derived chiefly from people originated from sub-Saharan and Sahelian cultures in Africa. Over hundreds of years, black culture has partiallyRead MoreAfrican-American Culture2578 Words   |  11 PagesRunning head: AFRICAN-AMERICAN CULTURE African-American Culture Abstract In this paper I discuss the African-American culture in regards to values, norms and beliefs. I also discuss my family’s adaptation to these values, norms and beliefs along with my own individual cultural sense of identity. Lastly, this paper reflects the impact of my role and ethical responsibilities as a social worker, especially in relation to working with the Hmong family in the book The Spirit Catches You and YouRead MoreAfrican Americans And The American Culture Essay1630 Words   |  7 PagesThe American culture is define to everyone in their own way. Everyone grows up differently in a particular community that shares the same languages, values, rules, and customs. The American Culture on that is consider to be a â€Å"melting pot†, because of all the different cultures that reside inside of it making it so diverse. Race in this country has never been a great topic throughout history. African Americans play a huge role into defining what our culture is as a whole, as well as being a partRead MoreAfrican American Culture in the Americas741 Words   |  3 Pages African Americans brought over a distinctive culture into America from Africa. The Africans can create many different sounds that we never knew about. They revived the way we held church and worship, and brought joy to many citizens. African Americans enslaved by the South created a truly magnificent culture in slavery using new music, oral traditions, and religious ideas. Many African countries are known for their spectacular music, and during the time of slavery many African American slavesRead MoreAfrican American Music Culture1490 Words   |  6 PagesAfrican American Music Culture Jakiella James â€Å"African-American gospel music is a major influence in nearly all genres of modern popular music, from rhythm ‘n blues to jazz, from soul to rock ‘n roll. The musical genre is a unique expression of the black experience in America? The emotionally-charged, wailing vocals and syncopated rhythms give the music a distinctive style. The singing is accompanied not only by instrumentals, but often also by hand-clapping, foot-stomping and shouting

Financial Decision making Assessment

Questions: Assignment Tasks Ambien PLC is a manufacturing company operating in the UK. You have recently been taken on in the position of Financial Controller. You have been asked by management to produce an assessment of a number of current issues facing the company as it seeks to expand its operations. Your assessment should be in the form of a formal business report, which would be suitable for presentation to the senior managers of Ambien PLC. Issue 1 Working Capital Management and Variance Analysis The company utilizes a bank overdraft to manage its short term working capital needs. But the Managing Director has mentioned that he is fed up of being in the red and would like some information on the profitability and short term capital planning of the company. He has presented you with the last three months cash budgets (both budgeted and actual: Cash Budget for the three months ending 30th October 2014 Budgeted Actual August September October August September October ,000 ,000 ,000 ,000 ,000 ,000 Cash Receipts 210 200 125 205 200 120 Capital Received 500 500 Br Fwd. Cash on Hand/(OD) -200 -200 Total 10 700 125 5 700 120 Rental Rates 5 5 5 5 5 5 Admin Sales Expenses 3 3 3 3 4 4 Distribution Expenses 2 2 2 1 2 2 Direct Labour 25 25 25 30 30 30 Cash Purchases (Raw Materials) 50 50 50 50 55 60 Capital Investment 50 50 Taxation Paid 500 500 Managerial Wages 20 20 20 20 20 20 Total 105 605 155 109 616 171 Balance -95 95 -30 -104 84 -51 Crd. Fwd. -95 0 -30 -104 -20 -71 The following information is also relevant: A depreciation charge of 10,000 was made during the period. All raw materials are paid for at the end of the month of delivery, the company keeps one months supply based on sales projections (i.e. the stock purchased and paid for during the month is used up in the following months production). Cash receipts represent the companys credit terms of two months to its customers. The sales department have forwarded the following information to you: Actual Sales (,000) for: September October 150 200 Projected Sales (,000) for: November December January 210 150 125 Section One of your report should include the following: A numerical variance analysis of the previous financial quarter along with a detailed written commentary as to the variances discovered and what might have caused them. This should include your recommendations as to how to improve the production variances in the future. A Budgeted and Actual Profit and Loss statement for the period, as well as a Budgeted Profit and Loss Statement and Cash Budget for the current quarter. You will need to make some judgements as to the expenses likely to be incurred in the quarter based on your analysis of the variances above. Assume no further capital investment or taxation paid during the quarter. A detailed written analysis of the short term working capital requirements of the company with suggestions recommendations on how to improve the situation. Issue 2 Capital Investment Appraisal The previous Financial Controller oversaw the recent capital investment of 500,000 in new PM. Unfortunately he left his working notes in a mess and other than a brief analysis of cash in-flows and out-flows there is not much in the way of proper analysis of this expenditure. Due to your recent studies in the area of capital investment appraisal you feel that you can offer the company a far better analysis of the investment and establish more robust procedures for evaluating future capital investment. In your briefing with the Managing Director you have learned that the company to date has operated a hurdle for capital investment of 3 years to payback. You mentioned at the time that payback is an inferior system for capital investment appraisal, but the MD did not have time to listen to your ideas regarding Net Present Value and the time value of money. The analysis of cash in and out flows is presented here: Capital Investment Appraisal Year 0 1 2 3 4 5 Cash Out-Flows - Cost of Machinery -500 - Feasibility Study -20 Total -520 0 0 0 0 0 Cash In-Flows - Reduction in Direct O/H 200 150 150 100 100 - Residual Value of the Machinery 50 Total 0 200 150 150 100 150 Net Cash Flow -520 200 150 150 100 150 The following information is also relevant: The company has a cost of equity capital of 14% and a cost of debt capital of 6%. The company is geared 50:50 debt to equity. The feasibility study refers to a long term project on the viability of purchasing new PM. The previous FC has included this as a direct cost of the project Section Two of your report should include the following: A derivation and explanation of the companys weighted average cost of capital. A detailed analysis of the capital project, including payback analysis (bearing in mind the companys existing capital budgeting hurdle) and an analysis of NPV. A detailed commentary on the primacy of NPV analysis as a capital investment appraisal tool along with recommendations on the future capital budgeting processes at the company. Issue 3 Foreign Trade, Exchange and Risk Management The company is currently planning to expand its operations into new production facilities in Europe. The company has developed a new product which is to be sold in Europe. The Raw Materials for the new product are being shipped in from the United States. At the time of the order 1 = 1.385 $US. The first consignment of Raw Materials cost $500 per unit in direct materials for each unit of production, payment must be made in full on dispatch of the Raw Materials. Further; production, distribution and selling costs are estimated to be 300,000. The selling price per unit is projected to be 750. The first consignment of Raw Materials is due to be delivered from the US in three months from the date of the order. The company has predicted production demand of 1000 units of production in the first run. The company has negotiated with its bank a 3 month forward rate contract of 1 = 1.435 $US. The previous FC had taken some advice from a FOREX expert on the likely volatility of the exchange rates between Euros and Dollars. He has produced an analysis that the forward rate predicted by the bank could vary by as much as 15% either way. The new production facility has been financed by the issuing of debentures in the European debt markets. The total value of the bonds is 500,000. Section Three of your report should include the following: A numerical analysis of the total profit or loss that can be expected if the company sells all units on production. This analysis should include the current price, the forward rate and should be adjusted for the predictions that the forward rate could vary by as much as 15%. A written commentary on the nature of risk, bearing in mind that the company has taken on debentures in a foreign currency.This commentary must include recommendations for mitigating the identified risks. Answers: Issue 1: Working Capital Management and Variance Analysis Variance Analysis Variance Analysis Particulars Budgeted (,000) Actual (,000) Variance (Actual Budgeted) (,000) Aug Sep Oct Aug Sep Oct Aug Sept Oct Direct Material 50 50 50 50 55 60 0 5 10 Direct Labour 25 25 25 30 30 30 5 5 5 Overheads 30 30 30 29 31 31 -1 1 1 Material Variance It can be observed that the variances of previous quarter of material are respectively 0, 5000 and 10000. It has gradually increased from one month to another month. This is not favourable for the company. It may be the causes such as hike in market price of material, purchasing of standard materials than lower quality, strong bargaining power of vendors, inefficiency in buying by the procurement staffs, excluding of discount due to purchase of smaller sizes (Diriba, 2013). The company should implement better practices of procurement such as inviting the suppliers with price quotations. Purchase should be at larger size and Procurement staff should increase their negotiable skill. Labour Variance Labour variance of every month of the quarter is 5000 which is adverse and there is no improvement from one month to another month. Reason behind of it may be increasing of minimum wage rate, inefficiency in hiring, hiring of large number of skilled labour or existence of strong negotiation by the labour unions. To convert into favourable position, the company should do effective planning on hiring of labour and should reformulate the standard cost of labour (Bragg, 2001). Overhead Variance Here, overhead includes Rent Rates, Admin Sales Expenses, Distribution Expenses and Managerial Wages. On the above table, variance indicates that the company was favourable in the month August where the actual cost was less than the budgeted cost. But suddenly, it has increased in the month of September and it is also remain same in October. This is due to increase in Admin Sales Expenses and Distribution Expenses. Admin Sale Expenses and Distribution Expenses of the organization should be properly managed to reduce the cost. Profit Loss Statement Budgeted 000(AUG) 000(SEP) 000(OCT) PERTICULARS Cash receipts (sales) 210 200 125 less: Cash purchase ( raw materials) 50 50 50 Gross Profit 160 150 75 less: Rental Rates 5 5 5 Admin and sales expenses 3 3 3 Distribution expenses 2 2 2 Direct Labor 25 25 25 Managerial wages 20 20 20 Net profit before Tax(NPBT) 105 95 20 less: Taxation paid 500 Net profit after tax (NPAT) 105 -405 20 Budgeted profit loss account is the expected figure of income and expenses. It is made periodically to plan for the future income and expenses. Actual ACTUALPERTICULARS 000(AUG) 000(SEP) 000(OCT) Cash receipts (sales) less: 205 150 200 Cash purchase ( raw materials) Gross Profit 50 55 60 less: 155 -5 150 Rental Rates Admin and sales expenses 5 5 5 Distribution expenses 3 4 4 Direct Labor 1 2 2 Managerial wages 30 30 30 Depreciation 20 20 20 Net profit before Tax(NPBT) 96 -66 89 less: Taxation paid 500 Net profit after Tax(NPAT) 96 -566 89 Actual profit loss statement is compared to budgeted profit loss account to find out whether the company is meeting the plan. Here, the budgeted and actual profit loss account statement show that the company has earn less profit than budgeted in the month of August. In the month of September, it has more loss than the budgeted. But, it has earned more profit in month of October than the budgeted. Company is incurred loss in the second month of a quarter because the tax is paid in the second month of a quarter. 1.2.1 Assumed Current Quarter Profit Loss Statement Budgeted PERTICULARS 000(NOV) 000(DEC) 000(JAN) Cash receipts (sales) 210 150 125 less: Cash purchase ( raw materials) 55 55 55 Gross Profit 155 95 70 less: Rental Rates 5.25 5.25 5.25 Admin and sales expenses 3 3 3 Distribution expenses 2.2 2.2 2.2 Direct Labor 25 25 25 Managerial wages 20 20 20 Depreciation 10 10 10 Net profit before Tax(NPBT) 89.55 29.55 4.55 less: Taxation paid 475 Net profit after Tax(NPAT) 89.55 -445.45 4.55 Actual PERTICULARS 000(NOV) 000(DEC) 000(JAN) Cash receipts (sales) 205 150 200 less: Cash purchase ( raw materials) 55 60 66 Gross Profit 150 90 134 less: Rental Rates 5.25 5.25 5.25 Admin and sales expenses 3 4 4 Distribution expenses 1.1 2.2 2.2 Direct Labor 30 30 30 Managerial wages 20 20 20 Depreciation 10 10 10 Net profit before Tax(NPBT) 80.65 20.65 64.65 less: Taxation paid 475 Net profit after Tax(NPAT) 80.65 -454.35 64.65 Assumptions for Profit and loss statement: We are assuming that rental and rent has been increased by 5% for next quarter Cash purchase has been increased by 10% Distribution expenses has been increased by 10% Managerial wages, direct labour, Admin and Sales expenses are remain constant. Taxation rate has been decreased by 5% for next quarter. In the current financial quarter, the profit of the company has reduced in the month of August and incurred more loss in the month of more loss in the September than the budgeted. But, in the month of October, the earned amount of profit is more high than the budgeted. This is happening due to the variance of cash receipts on sales. Cash Budget PERTICULARS 000(NOV) 000(DEC) 000(JAN) RECEIPTS: Cash receipts 150 200 150 Capital receipts 200 200 Cash in hand / overdrawn -71 -30.35 263.2 TOTAL RECEIPTS 79 369.65 613.2 PAYMENTS : Rental and Rates 5.25 5.25 5.25 Admin and sales expenses 3 4 4 Distribution expenses 1.1 2.2 2.2 Direct Labor 30 30 30 Cash Purchase ( Raw Material) 60 55 60 Capital Investment Taxation Paid Managerial Wages Depreciation 10 10 10 TOTAL PAYMENTS 109.35 106.45 111.45 Balance -30.35 263.2 501.75 Crd Frd -30.35 0 0 Assumptions for Cash Budget Next quarter Capital Received for the month of December and January are 200000 Cash budget is estimated cash flows both inflows and outflows for a specific period. Analysis of Working Capital Management Working capital is the short-term capital required to invest for continuing the day-to-business. It is the outcome of time lag between expenses related to purchasing of raw materials and cash collection through selling of finished goods. There are components of working capital such as inventories, cash payables, cash receivables. Each component has contribution to working capital. Working capital is changed time to time for the proportion of the components. Liquidity and profitability can be decided by the requirement of working capital which creates effect on the decisions of investing and financing (Sagner, 2011). If working capital requirement is very less, it may require less amount of financing. As a result, more cash is available for shareholders. But at a same time less amount requirement of working capital may decrease the sales volume. So, profitability may be affected. For good financial health of an organization, it is very important to manage the proportion of components of working capital management. Operating cycle is an important tool of analyzing the components of working capital (Preve Sarria-Allende, 2010). All the components are converted in terms of days such as average days taken to collect the account receivables, average days taken to turn over the sale of a product and average number of days taken for paying the account payables to supplier. Less amount of account receivable means company follows strict collection policies and provides a less amount of credit to sell. As a result, cash inflow can be increased. Following a strict collections policies and less credit may decrease the sale and profits of the company can be reduced. Increase in accounts payables availing a longer credit period from supplier means taking of low quality materials which can reduces the profitability. Decrease in inventory, company may fall in crisis to sell. There are aspects of working capital: Current Assets and Current Liabilities. The issues can be raised from the both aspects. Current assets are short-term fund to meet the short-term liabilities. Current assets include cash, accounts receivable and inventory, etc. The issues related to current assets may be keeping too much inventory, allowing customer too much time to pay the credit amount. Current liabilities include accounts payable, short-term debt, etc. The issues related to current liabilities may be getting of short-term period to pay the suppliers and increasing of borrowing to keep running the business. The cash collection policy of the company is not favourable. The payment to suppliers is done at the end of the month of delivery where customers avail two months for payment of credit amount. So, cash collection does not efficient to meet the payment to suppliers. Issue 2: Capital Investment Appraisal Section One: Derivation of Weighted Average Cost of Capital The company financed both equity and debt capital in equal proportion. Tax rate is not included. So, the weighted average cost of capital is as follows: Particulars Value (%) Proportion Cost of equity (%) 14 0.50 Cost of debt (%) 6 0.50 WACC 10 A company has different sources of finance such as Equity, Debt, Retained earnings, Short-term and Long-term Loan. Weighted average cost of capital is the average of all the sources of capital. Here, the company has two sources of capital, Equity and Debt. WACC is calculated by using the following formula: WACC= (Proportion of Equity Cost of Equity) + (Proportion of Debt Cost of Debt) WACC is the average rate of return which is expected to compensate all the different investors of the company. Here, the WACC is 10% that means company has to pay $0.10 against $1to its investors. It is helpful to gauge the expense of funding in future projects. It is also used in discounting cash flows for appraising the capital investment. Lower WACC means the company decides to increase its use of cheaper financing sources. If the cost of debt less than the cost of equity, the companys weighted average cost of capital will decrease. In case of this company, it is observed that the proportion of equity and debt capital is equal and also the cost of debt is less than the cost of equity. That means the company would like to face less risk for its capital investment. Section Two: Payback analysis and NVP analysis 2.1. Pay Back Analysis Calculation of Pay Back Period Year Cash Out-Flows Cash In-Flows Cumulative Cash In-Flows 0 -520 1 200 200 2 150 350 3 150 500 4 100 600 5 150 750 Payback Period 3.20 Payback period is calculated to find out the length of time required to recover the cost of investment. According to that the decision is taken whether to undertake the project or not. Longer the payback period is not suitable for investment (Peterson Drake Fabozzi, 2002). It is usually expressed in years and calculated by using following formula: Payback period = Cost of Project / Annual Cash Inflows Cash Inflows are accumulated by year until the Cumulative Cash Inflow becomes positive in respect of its total investment. Here, Cumulative Cash Inflow becomes positive in the 4th year. So, Payback period is 4 years but in exact, it would be 3.20 years. The drawbacks of Payback back period are as follows: 1. Payback period method does not consider time value of money. But some companies modified this method by adjusting the time value of money to get to get the discounted Payback period. 2. According to Payback period method, the better investment is that one which has the shorter payback period. But it ignores the any benefits that occur after the payback period. So, it does not measure profitability. 2.2. NPV Analysis Year 0 1 2 3 4 5 Cash Outflow -520 Cash Inflow 200 150 150 100 150 Discount Rate 10% 0.90909091 0.826446281 0.751315 0.683013 0.620921 Present Value 181.818182 123.9669421 112.6972 68.30135 93.1382 Total Present Value 579.92 Net Present Value 59.92 A rate of return is assumed or set to discount the net cash inflows from a project. Here, rate of return is assumed 10% which is equal to Weighted Average Cost of Capital derived in previous in previous task. If, NPV is positive or zero, the project is accepted and project is rejected when it is negative. In case two or more excusive projects having positive NPVs, highest NPV project is accepted (Langdon, 2002). Here, the NPV is positive (59.92). So, the project may be accepted by the company. 2.3. Primacy of NPV Analysis Net Present Value (NPV) is the present value of net cash inflows expected from a project including residual value, if any, less the initial outlay of the project. NPV is used in Capital Budgeting to measure the profitability of an investment or a project. It is one of the most reliable methods because time value of money is adjusted by using discounted cash inflows (Pettinger, 2000). To calculate the NPV, first the present value of net cash inflows is determined from a project. The net cash flows may be equal or may different. If they are equal, present value can be calculated by using the present value of formula of annuity. However, if they are different the present value of each individual net cash inflow calculated separately (Costantini, 2006). NPV of annuity is calculated by following formula: Where, R is the net cash inflow expected to be received each period; i is the required rate of return n are the number of periods And, NPV of different cash inflows is calculated as follows: Where, i is the target rate of return; R1 is the net cash inflow during the first period; R2 is the net cash inflow during the second period; R3 is the net cash inflow during the second period, and so on. NPV having positive value or zero is accepted. In comparison of two projects, the highest NPV project is accepted (Burger Hawkesworth, 2013). The drawback of NPV is that it is based on estimated future cash flows of the project and estimates may far from actual results (Baum Crosby, 2008). This is due to the assumption of discounting rate. In order to result the particular issue, firm or organization can employ Internal Rate Return (IRR). So, in future budgetary process, organization needs use both NPV and IRR as investment appraisal process (Ballantine, Galliers Stray, 1995). Issue 3: Foreign Trade, Exchange and Risk Management 3.1 Analysis of Profit Loss At current exchange rate Current exchange rate: 1=1.385 $US Raw material cost per unit is $500. So, total material cost = $500 1000 units = $500000 Total material in Euro with current exchange rate = 361010.83 Production, distribution and selling cost = 300000 Selling price per unit = 750 Total revenue from sales = 750 1000 units = 750000 Profit = 750000 - (361010.83 + 300000) = 88989.17 At 15% increasing Exchange rate will be 1 = 1.593 $US So, total material cost in Euro = $500000 / 1.593 = 313873.19 Profit = 750000 - (313873.19 + 300000) = 136126.81 At 15% decreasing Exchange rate will be 1 = 1.177 $US So, total material cost in Euro = $500000/1.177 = 424808.84 Profit = 750000 - ( 424808.84 + 300000) = 25191.16 At 3 month forward contract rate Three month forward contract is 1 = 1.435 $US So, total material cost will be in Euro = $500000/1.435 = 348432.05 Profit = 750000 - (348432.05+ 300000) = 101567.95 The above calculation shows that if the company agrees to buy raw materials from US at spot price, the profit will be affected. The materials will be delivered from US after three months of order and the forward rate may vary as much as 15% either way according to the FOREX expert analysis report. So, at the time payment of raw materials, company has to pay more if the currency value of US dollar decreases by 15% rather than increasing. As well as, company will earn more profit if currency value of US dollar decreases by 15% than increasing. But, there is risk associated with it that it may increase or decrease. There is another option for going forward contract. So, if the company chooses to buy raw material from US at 3 three months forward contract rate, it can earn a favourable profit avoiding the risk associated with currency rate. Therefore, it will be a better option for the company to choose the 3 month forward contract rate. 3.2 Risk associated with issuing of debenture in a foreign currency Company has to bear risk to choose the debt financing instrument in a foreign currency. The important risk with foreign financing is foreign exchange risk which makes difficult to control the stable and reliable earnings (Crowley Lee, 2003). Foreign exchange risk depends on the changes of currency rate and value of investment gets affected. When profit is exchanged in domestic currency, earnings of profit from a foreign country can be decreased if domestic currency gets appreciated in respect of the foreign currency. Exchange rate is volatile in nature and it affects on sales and revenue of the company (MacDonald, Menkhoff Rebitzky, 2009). Suppose the company has decided to raise it finance of 500000 through debenture in US currency. Assume that, current exchange rate of Euro in respect of US dollar is 1=1.385 US $. If the Euro currency gets depreciated with US dollar (1=1.152), company has to pay more amounts at the time of interest payment or full payment of debenture (Kikerkova, n.d.). Mitigation of Exchange Risk The exchange risk can be mitigated through hedging the fund. Company can choose to raise the fund through future contract, forward contract and options on currency the currency market (DeRosa, 2011). Suppose the company chooses to issue debenture in foreign currency through forward contract. So, exchange risk can be avoided and company can earn more revenues. References List Books: Diriba, H. (2013).Cost Variance Analysis Under Decomposition Method. SaarbruÃÅ'ˆcken: LAP LAMBERT Academic Publishing. Sagner, J. (2011).Essentials of working capital management. Hoboken, N.J.: Wiley. Preve, L., Sarria-Allende, V. (2010).Working capital management. New York: Oxford University Press. Pettinger, R. (2000).Investment appraisal. New York, N.Y.: St. Martin's Press. Peterson Drake, P., Fabozzi, F. (2002).Capital budgeting. New York, NY: Wiley. Langdon, K. (2002).Investment appraisal. Oxford, England: Capstone Pub. Costantini, P. (2006).Cash return on capital invested. Amsterdam: Butterworth-Heinemann. Bragg, S. (2001).Cost accounting. New York: John Wiley. Baum, A., Crosby, N. (2008).Property investment appraisal. Oxford: Blackwell Pub. DeRosa, D. (2011).Options on foreign exchange. Hoboken, N.J.: Wiley. MacDonald, R., Menkhoff, L., Rebitzky, R. (2009).Exchange rate forecasters' performance. Munich: Univ., Center for Economic Studies. Journals: Ballantine, J., Galliers, R., Stray, S. (1995). The use and importance of financial appraisal techniques in the IS/IT investment decision-making processrecent UK evidence.Project Appraisal,10(4), 233-241 Burger, P., Hawkesworth, I. (2013). Capital budgeting and procurement practices.OECD Journal On Budgeting,13(1), 57-104 Crowley, P., Lee, J. (2003). EXCHANGE RATE VOLATILITY AND FOREIGN INVESTMENT: International Evidence.The International Trade Journal,17(3), 227-252. Kikerkova, I. CEFTA-2006 Effects Upon the Macedonian Foreign Trade Exchange.SSRN Journal.

Determine The Tax Consequences For Salary â€Myassignmenthelp.Com

Question: Discuss About The Determine The Tax Consequences For Salary? Answer: Introducation The report explains the treatment of tax of income that have been derived from working in an oversea university as a coordinator. The terms of work for the coordinator is that Can Robyn can continue to works as long as he wished or as long as the course existed in the Calcutta University. The Taxation Ruling IT 2650 provides certain guidelines that is useful in determine whether an individual leaving Australia for working overseas should be determine as resident or nonresident for the purpose of tax for the time of staying outside Australia[1]. The section 6(1) of the Income Tax Assessment Act 1936 provides that an individual whose domicile is in Australia is considered as an Australian resident for the purpose of tax unless the commissioner is satisfied that individual is nonresident for the purpose of tax[2]. The section provides that an individual staying in Australia continuously for more than 6 month is generally regarded as a resident for the purpose of tax. However, if the commissioner is satisfied that the individual does not have the intention of residing in Australia in that case the individual will not be regarded as resident for the purpose of tax. On evaluating the current case under section, 6(1) of the Income tax Assessment Act 1936 Can Robyn should be regarded as the resident of Australia as she has stayed in Australia for more than 6 months before leaving the country for employment overseas[3]. In addition to this Can Robyn continued to have the place of residence in Australia and did not sell the flat of Melbourne. It is assumed that the flat was mortgaged as she paid the mortgage amount from the income received from employment. The income from employment was received in Australian bank. In the case of Henderson v. Henderson [1965] 1 All E.R.179 it was provided that a person is taken to have the domicile of the place of origin unless the individual taken a domicile in any other country. In the current case, it can be seen that Can Robyn has continued to maintain the flat in Melbourne that indicates she has the clear intention to come back to Australia after the employment with Calcutta University is ceased[4]. The Taxation Ruling IT 2650 provides that the income received in an Australian bank for working overseas is taxable. In applying the ruling, the residence of the taxpayer should be considered. In the case of F.C. of T. v. Applegate(1979) 9 ATR 899 the most important thing that needs to be determined is the residential status of the individual leaving Australia for the tax purpose[5]. In case an individual continues to maintain the domicile is Australia then the individual would be regarded as the resident. That means an individual obtaining domicile of his own choice or through the operation of law is regarded as the non-resident. In the present case, Can Robyn maintains her bank account in Australia and continues to receive her income from employment on that account. The mortgage for the flat is paid from the income received on that bank account. Therefore, it can be said that in case of Can Robyn in spite of obtaining working visa for substantial period it can be considered as adequate for considering her a non-resident for the purpose of tax[6]. The salary received in the Australian bank will be regarded from the university of Calcutta will be treated as foreign employment income. The income earned by an Australian resident from an overseas employment is termed as foreign employment income. In Australia, an individual is generally taxed on the income that is derived every quarter from every corner of the world. In this case, Can Robyn has received has salary in her Australian bank account. The income that is received in Australian bank account from source outside Australia will treated as assessable income. It should be noted that even though the payment has been received in Australia and not the person working overseas it should be considered as foreign employment income. Therefore, based on the F.C. of T. v. Jenkins 82 ATC 4098 it can be concluded that the foreign employment income that is received from India is taxable and so it should be included in the assessable income. According to the subsection 6-5 (2) and (3) of the Income Tax Assessment Act 1997, it is compulsory that each of the taxpayer should take account of their taxable income in the gross income which they generate[7]. As mentioned in subsection 6-5 (2) and (3) any income that is earned during a year but it is received in some other or in another year turns out to be the matter of the taxpayer. It is very important and vital to determine by applying appropriate method the amount of earnings that is generated in an income year for the taxpayer. It is clearly mentioned in taxation rulings of TR 93/11 that it is essential for each person in order to ascertain the assessable income to apply either their receipt process of tax accounting or their earning process[8]. As per TR 93/11 receipt of income fee under subsection 25 (1) will be treated as incomes in compliance with the regular perceptions of the ITAA 1936 for professional whose earning or income is treated for the purpose of assessment under accumulation basis or accrual basis[9]. It is obvious from the situation where Paul received a fee earning from the private lesson of golf from his client. Thus the query relating to the treatment of professional fee is introduced under subsection 25 (1) of the ITAA. From the present study of Paul with reference to the contract entered into by Paul, the following case must be determined. It is also established that following the five years of golf lesson imparted, Paul had received a fee from one of his client named Doreen. As a result of which a recoverable debt was established where it is not required by the professional person to take on any prior action to the debt becoming entitled for payment. If the time to compensate is being approved then the fee shall be recoverable in the applicable sense. As it is detained in the case of Henderson v. FC of T (1970) earning which is assessable on accumulation or accrual basis, those are derived under subsection 25(1) if the ITAA on creation of a recoverable debt. Alongside this, either on receiving the fee, income in advance by a professional person and by creating some arrangement among the client and the professional the fee income that is produced in the income year become associated partially or fully for which the professional person completes the work[10]. As it is obvious from the present situation that it can be determined that the fee income which Paul had derived is considered as the portion of his computable income and which shall be taken into consideration while ascertaining the tax liability. The current study of Paul states that Doreens receipt of fee income would be considered as the portion of assessable income. The amount of fee that Paul received would be treated as income in the year of revenue and such kind of incomes would be treated as assessable income due to the reason that the receipt of fee would be treated as recoverable debt for the lesson that is provided to his client[11]. While Pauls assessable income is ascertained, receipt of $6,000 and $28,000 would be considered as taxable income out of the golf lesson taught. As believed in the Barratt v. FC of T 92 ATC the Australian federal court had taken into consideration the statutory impairment during commencement of the proceedings of recoverable bad debt. However this does not delay the time of deriving the fee income under subsection 25 (1) by the professional individual whose income is intended to be treated for the purpose of tax under the basis of accumulation or accrual[12]. Conclusion: In order to settle with the current study, Pauls following situation has reflected the outcomes or magnitudes of income tax which is derived during the progress of the business. The income of Paul from his golf lesson will be considered as assessable income with reference to sub-section 25 (1) of the Income Tax Assessment Act 1936 it will also be taken into consideration in the assessable income. Reference Braithwaite, Valerie, ed.Taxing democracy: Understanding tax avoidance and evasion. Routledge, 2017. Cheshire, Lynda, Jo-Anne Everingham, and Geoffrey Lawrence. "Governing the impacts of mining and the impacts of mining governance: Challenges for rural and regional local governments in Australia."Journal of Rural Studies36 (2014): 330-339. Davis, Angela K., David A. Guenther, Linda K. Krull, and Brian M. Williams. "Do socially responsible firms pay more taxes?."The Accounting Review91, no. 1 (2015): 47-68. England, Phillipa. "Between Regulation and Markets: Ironies and Anomalies in the Regulatory Governance of Biodiversity Conservation in Australia."1 Australian Journal of Environmental Law(2016): 44. Forsyth, Peter, Larry Dwyer, Ray Spurr, and Tien Pham. "The impacts of Australia's departure tax: Tourism versus the economy?."Tourism Management40 (2014): 126-136. James, S., Sawyer, A., Wallschutzky, I. (2015). Tax simplification: A review of initiatives in Australia, New Zealand and the United Kingdom.eJournal of Tax Research,13(1), 280. Kucukvar, Murat, Gokhan Egilmez, and Omer Tatari. "Sustainability assessment of US final consumption and investments: triple-bottom-line inputoutput analysis."Journal of cleaner production81 (2014): 234-243. Lal, A., Mantilla-Herrera, A. M., Veerman, L., Backholer, K., Sacks, G., Moodie, M., ... Peeters, A. (2017). Modelled health benefits of a sugar-sweetened beverage tax across different socioeconomic groups in Australia: A cost-effectiveness and equity analysis.PLoS Medicine,14(6), e1002326. Picciotto, Sol. "Indeterminacy, complexity, technocracy and the reform of international corporate taxation."Social Legal Studies24, no. 2 (2015): 165-184. Richardson, Grant, Grantley Taylor, and Roman Lanis. "The impact of board of director oversight characteristics on corporate tax aggressiveness: An empirical analysis."Journal of Accounting and Public Policy32, no. 3 (2013): 68-88. Saad, Natrah. "Tax knowledge, tax complexity and tax compliance: Taxpayers view."Procedia-Social and Behavioral Sciences109 (2014): 1069-1075. Taylor, Grantley, and Grant Richardson. "The determinants of thinly capitalized tax avoidance structures: Evidence from Australian firms."Journal of International Accounting, Auditing and Taxation22, no. 1 (2013): 12-25 [1] Saad, Natrah. "Tax knowledge, tax complexity and tax compliance: Taxpayers view."Procedia-Social and Behavioral Sciences109 (2014): 1069-1075. [2 Braithwaite, Valerie, ed.Taxing democracy: Understanding tax avoidance and evasion. Routledge, 2017. [3] Davis, Angela K., David A. Guenther, Linda K. Krull, and Brian M. Williams. "Do socially responsible firms pay more taxes?."The Accounting Review91, no. 1 (2015): 47-68. [4] James, S., Sawyer, A., Wallschutzky, I. (2015). Tax simplification: A review of initiatives in Australia, New Zealand and the United Kingdom.eJournal of Tax Research,13(1), 280. [5] Lal, A., Mantilla-Herrera, A. M., Veerman, L., Backholer, K., Sacks, G., Moodie, M., ... Peeters, A. (2017). Modelled health benefits of a sugar-sweetened beverage tax across different socioeconomic groups in Australia: A cost-effectiveness and equity analysis.PLoS Medicine,14(6), e1002326. [6] Forsyth, Peter, Larry Dwyer, Ray Spurr, and Tien Pham. "The impacts of Australia's departure tax: Tourism versus the economy?."Tourism Management40 (2014): 126-136. [7] Cheshire, Lynda, Jo-Anne Everingham, and Geoffrey Lawrence. "Governing the impacts of mining and the impacts of mining governance: Challenges for rural and regional local governments in Australia."Journal of Rural Studies36 (2014): 330-339. [8] Taylor, Grantley, and Grant Richardson. "The determinants of thinly capitalized tax avoidance structures: Evidence from Australian firms."Journal of International Accounting, Auditing and Taxation22, no. 1 (2013): 12-25. [9] Richardson, Grant, Grantley Taylor, and Roman Lanis. "The impact of board of director oversight characteristics on corporate tax aggressiveness: An empirical analysis."Journal of Accounting and Public Policy32, no. 3 (2013): 68-88. [10] England, Phillipa. "Between Regulation and Markets: Ironies and Anomalies in the Regulatory Governance of Biodiversity Conservation in Australia."1 Australian Journal of Environmental Law(2016): 44. [11] Kucukvar, Murat, Gokhan Egilmez, and Omer Tatari. "Sustainability assessment of US final consumption and investments: triple-bottom-line inputoutput analysis."Journal of cleaner production81 (2014): 234-243. [12] Picciotto, Sol. "Indeterminacy, complexity, technocracy and the reform of international corporate taxation."Social Legal Studies24, no. 2 (2015): 165-184.