The Finance Club at a local university makes short-term investments in stock to study trends in various sectors of the stock market. On October 1, 2014, they purchased 100 shares of LeTableaux stock for $6,150. After eight months, the stock shares had increased in value by $135.00 and had paid dividends (part of a company's profit paid to stockholders) totaling $142.68. The Club decides to sell the stock at this point and evaluate their investment. Compare their gain to a bank savings plan paying simple annual interest (for 8 months) to determine the interest rate that this gain represents.
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- It is January 2nd. Senior management of Digby meets to determine their investment plan for the year. They decide to fully fund a plant and equipment purchase by issuing 50,000 shares of stock plus a new bond issue. The CFO happily notes this will raise their Leverage (-assets/equity) to a new target of 2.7. Assume the stock can be issued at yesterday's stock price ($37.86). Which of the following statements are true? Check all that apply. Select: 3 Digby will issue stock totaling $1,893,000 Total investment for Digby will be $5,111,100 The Digby bond issue will be $3,218,100 4 The Digby Working Capital will be unchanged at $16,095 Total Assets will rise to $226,004,000 Long term debt will increase from $83,016,908 to $84,909,908 Save AnswerThe following lists the six New York Stock Exchange volume leaders on June 24. An investor buys 100 shares of GE at the Last Trade price, pays a $100 commission on the purchase, and sells the 100 shares a year later for $37.78 per share with a 2% commission on the sale. (a) Find the total cost.$ (b) Find the total dividend.$ (c) Find the commission when selling the shares.$ (d) Find the capital gain when selling the shares.$ (e) Find the total return for the year.$ (f) Find the percent of return. (Round your answer to two decimal places.)According to a company press release, on January 5, 2012, Hansen Natural Corporation changed its name to Monster Beverage Corporation. According to Yahoo Finance, on that day the value of the company stock (symbol: MNST) was $15.64 per share. On January 5, 2018, the stock closed at $63.49 per share. This represents an increase of nearly 306%. A. Discuss the factors that might influence the increase in share price. B. Consider yourself as a potential shareholder. What factors would you consider when deciding whether or not to purchase shares in Monster Beverage Corporation today?
- Research online to find a company that bought back shares of its own stock (treasury stock) within the last 6–12 months. Why did it repurchase the shares? What happened to the companys stock price immediately after the repurchase and in the months since then? Is there any reason to think the repurchase impacted the price?Elroy Corporation repurchased 3,200 shares of its own stock for $40 per share. The stock has a par of $20 per share. A month later, Elroy resold 800 shares of the treasury stock for $48 per share. Required a. Record the two events in general journal format. b. What is the balance of the treasury stock account after these transactions? Complete this question by entering your answers in the tabs below. Required A Required B Record the two events in general journal format. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet A Elroy Corporation repurchased 3,200 shares of its own stock for $40 per share. Record the transaction. Note: Enter debits before credits. Event General Journal Debit Credit 1 Record entry Clear entry View general journalIn 1970, Wal-Mart offered 300,000 shares of itscommon stock to the public at a price of $16.50 pershare. Since that time, Wal-Mart has had 11 twofor-one stock splits. On a purchase of 100 shares at$16.50 per share on the company’s first offering,the number of shares has grown to 204,800 sharesworth $15,767,500 in July 2014. What is the returnon investment for investors who purchased the stockin 1970 (over a 44-year ownership period)? Assumethat no dividends were received during that period
- It is January 2nd and senior management of Digby meets to determine their investment plan for the year. They decide to fully fund a plant and equipment purchase by issuing 75,000 shares of stock plus a new bond issue. Assume the stock can be issued at yesterday's stock price ($41.66) and leverage changes to 2.7. Which of the following statements are true? Select all that apply. Select : 3 The total investment for Digby will be $24,031,182 Total liabilities will be $148,850,148 Digby will issue stock totaling $3,124,500 Total assets will rise to $234,396,164 Working capital will remain the same at $15,329,153 Save AnswerAssume that when you were in high school you saved $1,000 to invest for your college education.You purchased 200 shares of Smiley Incorporated, a small but profitable company. Over the threeyears that you have owned the stock, the corporation’s board of directors have taken the followingactions:1. Declared a 2-for-1 stock split.2. Declared a 20 percent stock dividend.3. Declared a 3-for-1 stock split.The current price of the stock is $12 per share.a. Calculate the current number of shares and the market value of your investment.b. Explain the likely reason the board of directors of the company has not declared a cash dividend.c. State your opinion as to whether or not you would have been better off if the board of directorshad declared a cash dividend instead of the stock dividend and stock splits.An investor purchased 200 shares of a stock at $60/share on January 1, 2012, then sold 100 shares for $63 on December 31, 2012, and kept the remaining 100 shares through the end of 2014. The stock traded for $80 at the end of 2013, and for $75 at the end of 2014, and paid an annual dividend of $2.00/share on December 30 of each of the three years it was held. What was the investor's dollar-weighted return? O 14.0% 48.2% O 10.2 12.6%
- Sakura Co. was established on January 1, 2011. On January 1, 2011, Sakura issued 100, 000 common shares for $500,000. The par value of each share is $1. On July 15, Sakura purchased back 2,000 of its own common shares at $6 each. On December 31, 2011, the stock market price of Sakura's common shares was $9 each. What is the balance of Sakura's common stock account on Dec 31, 2011?An investor purchased 500 shares of Electric Shaver Corporation stock at a price of $22.50 per share. One year later, the shares are selling for $21 each. The stock paid a dividend of $1.50 per share. What is the total percentage return on the investment? Group of answer choices -6.76% 0.00% 6.76% 7.14%The Tornado Truck Body Company decides to repurchase 10,000 shares of its common stock on January 20. The stock has $1 par value, and the market value per share of common stock on January 20 is $8.75. What account(s) and amount(s) would be debited in the required journal entry? Group of answer choices A)Treasury stock $87,500 b)Treasury stock $10,000 c)Treasury stock $10,000 and additional paid-in capital-treasury stock $77,500 d)Cash $87,500 E)None of the above