Course Code Course Name Section Code

IBM I–G2 International Market Entry BU1233 – G2

Strategies

Type of Evaluation Percentage Weight of Total

Evaluation
Winter 2020 Cost Sheet Assignment #1
15%

Course Instructor Due Date Total Marks

Gus Lazopoulos March 19th, 2020 /45

Student Name: _Rajvi Rajendra Chatwani__ Student ID #: 201900929

Student Name: _Aarti Satish Shah__ Student ID #: 201900633

Student Name: Taniya Saini Student ID #: 201901664

Student Name: __Kamalpreet Kaur Student ID #: 201901474

Student Name: __Ruchika Singh_ Student ID #: 201901398

1. Please, prepare the cost sheet, based on the following information. (15 Marks)
a) Commodity: Barley for animal feed
b) Quantity: 50,000 MT in bulk
c) Exchange rate: US $1.00 = CAD $1.10
d) Cost Ex-warehouse: CAD$350 per MT
e) Trucking (freight to dock): CAD$40 per MT
f) Wharfage and handling: CAD$25 per MT
g) Finance charge: 2.5%
h) Profit margin: 7%
i) Agent’s commission: CAD$50,000
j) Ocean freight: US$2, 500,000 for total shipment
k) Marin insurance: 1% on110% of the C&F value

Please, use the attached cost sheet to make your calculations, show all calculations,

Round your final answer to the nearest dollar amount; then, put the final price
to the nearest $5 amount.
 Costs CAD$ US$ Notes
Cost Cost
Cost [EXW] Ex-warehouse $350

Trucking (freight to dock) $40

Cost to Dock $390 $350 + $40 = $390

Wharfage and Handling

$25
Cost FAS (beside vessel) $415 $390 + $25 = $415

Finance Charge $10.38 $415 * 0.025 = $10.38

Profit Margin $29.78 ($415 + $10.38) * 0.07= $29.78

Agent’s Commission $1 50,000/50,000

$415 + $10.38 +$29.78 + $1 =

Price FOB $456.16 $456.16

Convert to US$ $414.69

(move to new column) $456.16/1.10 = $414.69
Ocean Freight $50

Price [CFR] C&F $464.69 $414.69 + $50 =$464.69

Marine Insurance $5.11 $464.69 * 1.1 * 0.01 = $5.11

Total [CIF] CIF $469.80 $464.69 + $5.11 = $469.80

Round to the nearest US$ $470

Round to the nearest US$5 $470

2. Please, prepare the cost sheet, based on the following information. (15 Marks)
a) Commodity: Crude Oil
b) Quantity: 200,000 Barrels in bulk
c) Exchange rate: US $1.00 = CAD $1.25
d) Cost Ex-warehouse: CAD$54 per Barrel
e) Piping Costs (Crude oil to dock): CAD$2.00 per Barrel
f) Wharfage and handling: CAD$1.00 per Barrel
g) Finance charge: 2.5%
h) Profit margin: 7%
i) Agent’s commission: CAD$0.25
j) Ocean freight: US$300,000 for total shipment
k) Marin insurance: 1% on110% of the C&F value

Please, use the attached cost sheet to make your calculations, show all calculations,

Round your final answer to the nearest dollar amount; then, put the final price
to the nearest $5 amount.
 Costs CAD$ US$ Notes
Cost Cost
Cost [EXW] Ex-warehouse $54

Trucking (freight to dock) $2

Cost to Dock $56 $54+ $2 =$56

Wharfage and Handling $1

Cost FAS (beside vessel) $57 $56+ $1= $57

Finance Charge $1.43 $57*0.025= $1.43

Profit Margin $4.09 ($57 + $1.43 )*0.07= $4.09

Agent’s Commission
$0.25
$57 + $1.43 + $4.09 + $0.25 =
Price FOB $62.77 $62.77

Convert to US$ $50.22 $62.77/1.25= $50.22

(move to new column)
Ocean Freight $1.50 $300,000 /200,000 =$1.50

Price [CFR] C&F $51.72 $50.22 + $1.50 = $51.72

Marine Insurance $0.57 $51.72 * 0.01 * 1.1 = $0.57

Total [CIF] CIF $52.29 $51.72+ $0.57 = $52.29

Round to the nearest US$ $52

Round to the nearest US$5 $50

3. Please, prepare the cost sheet, based on the following information. (15 Marks)
a) Commodity: Canola Oil
b) Quantity: 50,000 MT in bulk
c) Exchange rate: US $1.00 = CAD $1.25
d) Cost Ex-warehouse: CAD$900 per MT
e) Trucking (freight to dock): CAD$40 per MT
f) Wharfage and handling: CAD$25 per MT
g) Finance charge: 2.5%
h) Profit margin: 7%
i) Agent’s commission: CAD$50,000
j) Ocean freight: US$2, 500,000 for total shipment
k) Marin insurance: 1% on110% of the C&F value

Please, use the attached cost sheet to make your calculations, show all calculations,

Round your final answer to the nearest dollar amount; then, put the final price
to the nearest $5 amount.
 Costs CAD$ US$ Notes
Cost Cost
Cost [EXW] Ex-warehouse $900

Trucking (freight to dock) $40

Cost to Dock $940 $900+$40= $940

Wharfage and Handling $25

Cost FAS (beside vessel) $965 $940+$25=$965

Finance Charge $24.13 $965 * 0.025 = $24.13

Profit Margin $69.24 ($965+ $24.13) * 0.07= $69.24

Agent’s Commission $1 $50000/50000= $1

$965+$24.13+$69.24+$1=
Price FOB $1059.37 $1059.37

Convert to US$ $847.50 $1059.37/1.25 =$847.50

(move to new column)
Ocean Freight $50 $2,500,000/ 50000 =$50

Price [CFR] C&F $897.50 $847.50 + $50 =$897.50

Marine Insurance $9.87 $897.50*0.01*1.1= $9.87

Total [CIF] CIF $907.37 $897.50+ $9.87 = $907.37

Round to the nearest US$ $907

Round to the nearest US$5 $905