To construct: An inventory of investment holdings

Question

Consider the following two investment situations:1. In 1980, when W.M. Company went public, 100 shares cost $1,650. Thatinvestment was worth $12,283,904 after 32 years (2012) with a rate of returnof around 32%. 2. In 1990, if you bought 100 shares of First Mutual Funds it would have cost$5,245. That investment would have been worth $289,556 after 22 years. Which of the following statements is correct?(a) If you had bought only 50 shares of the W.M. Company stock in 1980 and kept them for 32 years, your rate of return would be 0.5 times 32%.(b) If you had bought 100 shares of First Mutual Funds in 1990, you would have made a profit at an annual rate of 30% on the funds remaining invested.(c) If you had bought 100 shares of W.M. Company in 1980 but sold them after IO years (assume that the W.M. Company stock value increased at an annual rate of 32% for the first 10 years) and immediately put all the proceeds into First Mutual Funds, then after 22 years the total worth of your investment…

Answer 1

Question

Chapter 11, Problem 9FPE

a)

Summary Introduction

To construct: An inventory of investment holdings

b)

Summary Introduction

To determine: The amount invested, annual income and values of investment.

Expert Solution & Answer

Trending nowThis is a popular solution!

See solution

Check out sample textbook solution

Students have asked these similar questions

Consider the following two investment situations:1. In 1980, when W.M. Company went public, 100 shares cost $1,650. Thatinvestment was worth $12,283,904 after 32 years (2012) with a rate of returnof around 32%. 2. In 1990, if you bought 100 shares of First Mutual Funds it would have cost$5,245. That investment would have been worth $289,556 after 22 years. Which of the following statements is correct?(a) If you had bought only 50 shares of the W.M. Company stock in 1980 and kept them for 32 years, your rate of return would be 0.5 times 32%.(b) If you had bought 100 shares of First Mutual Funds in 1990, you would have made a profit at an annual rate of 30% on the funds remaining invested.(c) If you had bought 100 shares of W.M. Company in 1980 but sold them after IO years (assume that the W.M. Company stock value increased at an annual rate of 32% for the first 10 years) and immediately put all the proceeds into First Mutual Funds, then after 22 years the total worth of your investment…

January 1, 2009 - Betty and Al sold 600,000 more shares of the company to the general public in an initial public offering. The initial price per share was $15.40 Would this accounting entry go into common stock or additional paid-in capital? What is the difference between the two?

You owned 300 shares of Microsoft stock. But you just sold 100 shares this morning. Which one of the following statements best describes the stock sale transaction? Group of answer choices a. This is an example of a secondary market transaction. b. This is an example of primary market transaction. c. This is an example of an exchange of physical assets. d. This is an example of money-market transaction.