Bill Campbell invested $5,300 and borrowed $5,300 to purchase shares in Kellogg. At the time of his investment, Kellogg stock was selling for $53 a share. Note: There were no commissions to buy or sell this stock. a. How many shares could he buy if he used his $5,300 and borrowed $5,300 on margin to buy Kellogg stock? Note: Round up your final answer to the nearest whole unit. b. Assuming Bill did use margin, sold his Kellogg stock $58 a share, how much profit did he make on his Kellogg investment? Note: Round up your intermediate value of "Total shares" to the nearest whole unit. Round your final answer to 2 decimal places. a. Number of shares b. Total profit 200✔ $ 5,876.00

Bill Campbell invested $5,300 and borrowed $5,300 to purchase shares in Kellogg. At the time of his investment, Kellogg stock was selling for $53 a share. Note: There were no commissions to buy or sell this stock. a. How many shares could he buy if he used his $5,300 and borrowed $5,300 on margin to buy Kellogg stock? Note: Round up your final answer to the nearest whole unit. b. Assuming Bill did use margin, sold his Kellogg stock $58 a share, how much profit did he make on his Kellogg investment? Note: Round up your intermediate value of "Total shares" to the nearest whole unit. Round your final answer to 2 decimal places. a. Number of shares b. Total profit 200✔ $ 5,876.00

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter2: Income Tax Concepts

Section: Chapter Questions

Problem 63IIP

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