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Answer the following problems with a complete solution.
a. Find the 5% commission on the total sales of P20,000.00
b. You bought 20 shares at P750.00 per share. The broker charged her a P150.00 commission. Find the cost of the stock.
c. You own 105 shares, par value P200.00. If the corporation declares an 8% dividend, what is the total dividend that should get?
d. You bought ten P750.00 bonds at 315 plus a 6% brokerage fee. Find the investment.
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- Suppose IWT has decided to distribute $50 million, which it presently is holding in liquid short-term investments. IWT’s value of operations is estimated to be about $1,937.5 million; it has $387.5 million in debt and zero preferred stock. As mentioned previously, IWT has 100 million shares of stock outstanding. Assume that IWT has not yet made the distribution. What is IWT’s intrinsic value of equity? What is its intrinsic stock price per share? Now suppose that IWT has just made the $50 million distribution in the form of dividends. What is IWT’s intrinsic value of equity? What is its intrinsic stock price per share? Suppose instead that IWT has just made the $50 million distribution in the form of a stock repurchase. Now what is IWT’s intrinsic value of equity? How many shares did IWT repurchase? How many shares remained outstanding after the repurchase? What is its intrinsic stock price per share after the repurchase?Answer these two problems with a complete solution.1. You own 25 shares of BDO stock, par value P800.00. If the corporation declares a 5.75% dividend, what is your total dividend that should get?2. If you own a share of stock that costs P1890 and pays an annual dividend of P10.50, what is the rate of income?You have a margin account and deposit Rs.90,000. Assuming the prevailing marginrequirement is 20%, commissions are ignored and D.G.K Cement stock is selling atRs.55 per share while Askari Cement stock is selling at Rs. 85 per share. You invest 40%of your investment in D.G.K cement while remaining is deposited in Askari cement.a. How many shares of each stock can you purchase using the maximum allowablemargin if you invest in both?b. What is your total and percentage profit (loss) if:1. the price of D.G.K Cement Rises to Rs.65 per share while Askari Cement stockrises to Rs. 97 per share?2. the price of D.G.K Cement reduces to Rs.42 per share while Askari Cementstock reduces to Rs. 76 per share?c. If you invest all money in D.G.K cement ONLY and the maintenance margin is 25%,to what price can D.G.K Cement stock fall before you will receive a margin call?d. If you invest all money in Askari cement ONLY and the maintenance margin is 25%,to what price can Askari cement stock fall before you…
- 1.) You purchase 600 shares of XYZ Corporation at $30 per share using an initial margin of 70%. The stock is now selling for $41 per share and you want to use the excess equity in your account to pyramid. You want to purchase 400 shares of JT Corporation at $122 per share. If the minimum initial margin is 60%, what is the minimum amount of equity that you will have to put up in this transaction? 2. You purchase 500 shares of Johns Incorporated at $50 per share using an initial margin of 60%. Your maintenance margin is 25% and the minimum initial margin is 50%. A. How low can the stock price fall before you receive a margin call? B. If the stock price falls to $21 a share, how much additional equity must you add to your account?In you cash account, you buy 100 shares of XYZ Corporation at a price of $10 per share. Two months later, XYZ pays a dividend $0.21 per share. You sell all 100 shares of XYZ three months later at a price of $12 per share. If you wanted to lever up the returns of this trade, you could have executed it in your _____ account. A) cash B) margin C) brokerage D) bankJiffy Wax Corp. can sell common stock for $ 15 per share and its investors require a 14% return. However, the administrative or flotation costs associated with selling the stock amount to $ 2.40 per share. What is the cost of capital for Jiffy Wax if the corporation raises money by selling common stock? Select one: a. 14.00% b. 21.50% C 30.00% d. 16.67%
- (can you explain how did they solve this: (show full solution and formula) USE THE FOLLOWING INFORMATION FOR THE PROBLEM (1) You decide to sell short 200 shares of XCorp stock at a price of $75. Your margin deposit is 65 percent. Commission on the sale is 1.25%. While you are short, the stock pays a $1.75 per share dividend. Interest on margin debt is 5.25% per year. (1) Suppose at the end of one year XCorp is selling at $90 per share and you cover your short position at this price. What is your rate of return on the investment?(Assume a 1.25% commission on the purchase) -40.64% -25.53% 21% 7% –71.2% Ans: Rate of return = [75-90-0.9375-1.125-1.75- (1-.65)(75)(.0525)]/[(.65)(75)+0.9375] =-40.64% Option a1. Suppose you want to buy 10,000 shares of MegaWorld Corporation at a price of 4.00. You put up P10,000 and borrow the rest. What does your account balance sheet would look like? What is your margin? 2. Supposed that in the previous problem you shorted 10,000 shares instead of buying. The initial margin is 60 percent. What does the account balance sheet look like? 3. You deposited P100,000 cash in brokerage account and short sell P200,000 of stocks on margin. Later the value of the stocks held short rises to P250,000. What is your account margin in percent?