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You have the following current information on Be-bel (Manitoba based toy manufacturing company) that sells custom made dollhouses in Canada. It imports decorative parts from

You have the following current information on Be-bel (Manitoba based toy manufacturing company) that sells custom made dollhouses in Canada. It imports decorative parts from China. Be-bel pays RMB 468.64/dollhouse for the decorative parts. The structure of each dollhouse is built in Canada that costs CAD29.5/unit. The OCFAT for 2019 is CAD 1.78 million. Calculate the conversion effect for the year 2020.

Annual sales = 25,000 dollhouses

Fixed costs = CAD 0.44 million

Price = CAD199

Depreciation = CAD 0.2 million

Tax rate = 45%

Current exchange rate CAD/RMB = 0.1999

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