Answer:
The 1-year HPR for the second stock is <u>12.84</u>%. The stock that will provide the better annualized holding period return is <u>Stock 1</u>.
Explanation:
<u>For First stock </u>
Total dividend from first stock = Dividend per share * Number quarters = $0.32 * 2 = $0.64
HPR of first stock = (Total dividend from first stock + (Selling price after six months - Initial selling price per share)) / Initial selling price = ($0.64 + ($31.72 - $27.85)) / $27.85 = 0.1619, or 16.19%
Annualized holding period return of first stock = HPR of first stock * Number 6 months in a year = 16.19% * 2 = 32.38%
<u>For Second stock </u>
Total dividend from second stock = Dividend per share * Number quarters = $0.67 * 4 = $2.68
Since you expect to sell the stock in one year, we have:
Annualized holding period return of second stock = The 1-year HPR for the second stock = (Total dividend from second stock + (Selling price after six months - Initial selling price per share)) / Initial selling price = ($2.68+ ($36.79 - $34.98)) / $34.98 = 0.1284, or 12.84%
Since the Annualized holding period return of first stock of 32.38% is higher than the Annualized holding period return of second stock of 12.84%. the first stock will provide the better annualized holding period return.
The 1-year HPR for the second stock is <u>12.84</u>%. The stock that will provide the better annualized holding period return is <u>Stock 1</u>.
Answer:
c. 120
Explanation:
The economic order quantity is the minimum amount of inventory that a seller must keep to demand and lower the holding cost. The formula for Economic order quantity is represented by the formula:
EOQ = 
EOQ = 
EOQ = 120
Answer:
d) credit to Paid-in Capital from Treasury Stock for $30,000
Explanation:
The entry for profit in sale of treasury stock is as computed below
Account Details Debit Credit
Cash (5000*20) $100,000
To treasury stock (5000*14) $70,000
To Additional paid in capital (5000*6) $30,000