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shusha [124]
2 years ago
11

A year ago, Kim Altman purchased 160 shares of BLK, Inc. for $20.50 on margin. At that time the margin requirement was 40 percen

t. If the interest rate on borrowed funds was 12 percent and she sold the stock for $29.00, what is the percentage return on the funds she invested in the stock
Business
1 answer:
Semmy [17]2 years ago
6 0

Answer:

85.66%

Explanation:

Calculation for what is the percentage return on the funds she invested in the stock

First step is to calculate the Cost of the shares

Cost of the shares=160 × $20.50

Cost of the shares= $3,280

Second step is to calculate the Margin

Margin=$3,280 × 0.4

Margin= $1,312.00

Third step is to calculate the Funds borrowed

Funds borrowed= $3,280-$1,312.00

Funds borrowed= $1,968.00

Fourth Step is to calculate Interest paid

Interest paid=$1,968.00 × 0.12

Interest paid= $236.16

Fifth step is to calculate Profit on the stock

Profit on the stock=$4,640.00 - $3,280

Profit on the stock = $1,360

(160*29=$4,640.00)

Last step is to calculate the Return on the investment

Return on the investment:m= ($1,360.00 - $236.16)/$1,312.00

Return on the investment=$1,123.84/$1312.00

Return on the investment=85.66%

Therefore the percentage return on the funds she invested in the stock is 85.66%

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Explanation:

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3 0
2 years ago
M/b ratios typically exceed -select- , which means that investors are willing to pay more for stocks than their accounting book
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M/b ratios typically exceed one, which means that investors are willing to pay more for stocks than their accounting book values.

The Book value is the carrying amount of the company's assets minus the receivables (such as company liabilities) that exceed common stock. The term book value comes from the accounting practice of accounting for assets at their original costs.

The Book value of a company is total assets minus total liabilities. Total assets and total liabilities are included on the balance sheet of the annual and quarterly reports.

Book value refers to the value of the asset reported on the balance sheet, that is, the value of the asset after the accumulated depreciation has been recorded. Every company owns multiple assets. Therefore, every business also has a book value, which is the present value of the asset minus the liability or accrued debt.

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4 0
2 years ago
Which of the following is a person who authorized an agent to act on his or her behalf ​
lina2011 [118]

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8 0
2 years ago
Henry Hutchins is discontent with his job but believes that his supervisor is a good man who will do whatever is necessary to re
insens350 [35]

Answer: (A) Loyalty

Explanation:

 According to the given scenario, Henry hutchins is dissatisfied with his job but he believes to the supervisor of the company that he helps in reducing the stress and disappointment from the job.

The Henry repose to the given problem is refers as the loyalty as he shows faith to his supervisor and also shows the loyalty that he helps in improve the conditions of his job.

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Suppose there are only two firms in an economy: Cowhide, Inc. produces leather and sells it to Couches, Inc., which produces and
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Answer:

C) $57,000

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