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likoan [24]
3 years ago
10

You own a portfolio that is 23 percent invested in Stock X, 38 percent in Stock Y, and 39 percent in Stock Z. The expected retur

ns on these three stocks are 11 percent, 14 percent, and 16 percent, respectively. What is the expected return on the portfolio
Business
1 answer:
Finger [1]3 years ago
7 0

Answer:

The expected return on the portfolio is <u>14.09%</u>.

Explanation:

Expected return on a portfolio refers to addition of the mu;ti[licatiom of weight in the portfolio and expected return of all the investment in the same portfolio.

Therefore, the expected return on this portfolio can be calculated using the following formula:

PER = (rX * wX) + (rY * wY) + (rZ * wZ) ....................... (1)

Where,

PER = Portfolio expected return = ?

rX = Expected returns on stock X = 11%

wX = Weight of amount invested in stock X = 23%

rY = Expected returns on stock Y = 14%

wY = Weight of amount invested in stock Y = 38%

rZ = Expected returns on stock Z = 16%

wZ = Weight of amount invested in stock Z = 39%

Substituting the values into equation (1), we have:

PER = (11% * 23%) + (14% * 38%) + (16% * 39%) = 14.09%

Therefore, the expected return on the portfolio is <u>14.09%</u>.

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Answer:

$5,456

Explanation:

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The relevant cost:

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3 years ago
Someone who wants credentials in skilled training, but in less time than a four- year degree should consider...
Pavlova-9 [17]

Answer:

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Explanation:

Someone who wants credentials in skilled training, but in less time than a four- year degree should consider Career or technical education.

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4 0
3 years ago
Use the following information to prepare a multistep income statement and a balance sheet for Sherman Equipment Co. for 2016. (H
Allisa [31]

Answer:

Sherman Equipment Co.

a) Sherman Equipment Co.

Multistep Income Statement

For the year ended December 31, 2016

Sales Revenue                          $320,000

Cost of Goods Sold                     148,000

Gross profit                               $172,000

Operating expenses:

Salaries Expense                     $ 69,000

Operating Expenses                  62,000

Uncollectible Accounts Expense 8,100

Total operating expenses      $139,100

Operating income                   $32,900

Interest Revenue                        5,400

Net income                             $38,300

Balance Sheet

As of December 31, 2016

Assets

Current Assets:

Cash                                                             $48,100

Interest Receivable (short term)                     1,500

Accounts Receivable                    56,000

Allowance for Doubtful Accounts (7,800)  48,200

Notes Receivable (short term)                    24,000

Supplies                                                          1,200

Inventory                                                     98,300

Prepaid Rent                                               12,500

Total current assets                              $233,800

Long-term assets:

Land                                                           40,000

Total assets                                          $273,800

Liabilities and Equity:

Current liabilities:

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Salaries Payable                                      12,000

Total current liabilities                         $58,000

Equity:

Common Stock                                 $100,000

Ending Retained Earnings                   115,800

Total equity                                       $215,800

Total liabilities and equity               $273,800

Explanation:

a) Data and Calculations:

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Interest Receivable (short term) 1,500

Accounts Receivable 56,000

Notes Receivable (short term) 24,000

Supplies 1,200

Inventory 98,300

Prepaid Rent 12,500

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Sales Revenue 320,000

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Operating Expenses $ 62,000

Uncollectible Accounts Expense 8,100

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Net income                              38,300

Dividends                                 (3,500)

Ending Retained Earnings    115,800

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