A firm purchased 5,000 shares of another firm at $15.00 per share and the investment represents passive influence. At year-end, the market price of the stock is $25.00. The revaluation adjustment entry would require a debit to the fair value adjustment account.
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- Suppose you purchase one share of the stock of Volatile Engineering Corporation at the beginning of year 1 for $36. At the end of year 1, you receive a $2 dividend and buy one more share for $30. At the end of year 2, you receive total dividends of $4 (i.e., $2 for each share) and sell the shares for $36.45 each. The dollar- weighted return on your investment is Answers: А. -1.75%. B. 8.00%. C. 4.08%. D. 8.53%. Е. 12.35%.ASSUME that the one year returns for COMPANY A are still (25%, -15%, 120%, -30%, -45%}. Assume also that you acquired shares in COMPANY B, which has had annual returns over the same period, of: {27; 35%; -10%; 10%; -15%}. What is the correlation between the returns on COMPANY A and COMPANY B shares? Multiple Choice 0.567 - 0.356 0.278 - 0.204 Assume that you own a portfolio comprised of 45% COMPANY A and 55% COMPANY B. What return do you expect to earn next year on this portfolio? Multiple Choice 9.74% 13.58% 10.12% 15.25%uppose you purchase one share of the stock of Volatile Engineering Corporation at the beginning of year 1 for $36. At the end of year 1, you buy one more share for $30. At the end of year 2, you sell the shares for $36.45 each. Assume no dividends were paid in both years; calculate the time-weighted (geometric average) return and dollar-weighted return on your investment.
- An investor sells a stock short for $97 a share. The company pays a $4.70 annual cash dividend. After a year has passed, the seller covers the short position at $85. If the margin requirement is 57 percent, what is the percentage return earned on the investment?Redo the calculations, assuming the price of the stock is $103 when the investor closes the position.Based on your calculations to both scenarios, what generalization can be inferred?A stock is bought for $23.25 and sold for $28.69 a year later, immediately after it has paid a dividend of $4.18. What is the capital gain rate for this transaction? NOTE: Enter the PERCENTAGE number rounding to two decimals. If your decimal answer is 0.034576, your answer must be 3.46. DO NOT USE the % sign. A stock is bought for $29.45 and sold for $35.96 a year later, immediately after it has paid a dividend of $3.97. What is the dividend yield for this transaction? NOTE: Enter the PERCENTAGE number rounding to two decimals. If your decimal answer is 0.034576, your answer must be 3.46. DO NOT USE the % sign. You own a portfolio that has $3,764 invested in Stock A and $7,514 invested in Stock B. If the expected returns on these stocks are 9.33% and 11.67%, respectively, what is the expected return on the portfolio? NOTE: Enter the PERCENTAGE number rounding to two decimals. If your decimal answer is 0.034576, your answer must be 3.46. DO NOT USE the % sign.2. The market value of the stocks of Sun Corporation at the beginning of year 1 is P150 per share; at the beginning of year 2 is P180. It declares divided of P20 per share. What is the holding period return from the said investment?
- The Busby Corporation had a share price at the start of the year of $26.80, paid a dividend of $0.57 at the end of the year, and had a share price of $30.00 at the end of the year. Which of the following is closest to the rate of return of investments in companies with equal risk to The Busby Corporation for this period? О А. 11.94% О В. 12.57% О С. 14.00% O D. 11.26%8.An investor purchased 100 shares of common stock at GH¢20 per share one year ago. The company declared and paid a dividend of GH¢2 per share during the year. The investor sold the stock for GH¢21 per share after the one-year holding period. a.Calculate the HPR for this investment Partition the HPR into dividend return and capital appreciation return .An initial margin required is 48% and maintenance of 55%. An investor buys GPH 9500 shares of stock of margin at TK 95.55 per share. The price of the stock subsequently drops to TK 47.60. a. Find the amount investor has to deposit for initiating the transaction. b.What is the actual margin at tk 56.56 share price is the account restricted? c.Show the amount of margin call is required to bring back account into operational at price of tk.53.90?
- Summarize and discuss the implications of the findings for the business or potential business transaction. ------- Kassidy's Kabob House has preferred stock outstanding that pays a dividend of $5 at the end of each year. The preferred sells for $50 a share. What is the stock's required rate of return? Assume the market is in equilibrium with the required return equal to the expected return. The stock's require rate of return is 10%.If iOS Corp. issues an additional $8 million of debt and uses this money to retire common stock, what will be the expected return on the stock? Assume that the change in capital structure does not affect the risk of the debt, and recall that the WACC under the initial capital structure is 13.85%. Enter your answer as a percentage. Do not include the percentage sign in your answer. Enter your answer rounded to 2 DECIMAL PLACES. TE= Number Click "Verify" to proceed to the next part of the question.a. An initial margin requirement is 54% and maintenance margin of 48%. An investor buys GPH, 9500 shares of stock on margin at Tk. 86.50 per share. The price of the stock subsequently drops to tk. 55.70. a. Find the amount investor has to deposit for initiating the transaction. b. What is the actual margin at tk. 54.25 share price is the account restricted? c. If the price rises to tk. 61.90, is there a margin call? d. Show the amount of margin call is required to bring back account into operational at price of tk. 63.10?
