2. Based on the following stock price and shares outstanding information, compute thebeginning and ending values for a price-weighted index and a market-value-weighted index.DECEMBER 31, 2011DECEMBER 31, 2012SharesSharesPriceOutstanding100,000,000PriceOutstandingStock K20100,000,00032Stock M802,000,000454,000,000Stock R4025,000,0004225,000,000"Stock split two-for-one during the year.a. Compute the percentage change in the value of each index during the year.b. Explain the difference in results between the two indexes.c. Compute the percentage change for an unweighted index and discuss why these resultsdiffer from those of the other indexes.

Name: 2. Based on the following stock price and shares outstanding informat
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Description: 2. Based on the following stock price and shares outstanding information, compute thebeginning and ending values for a price-weighted index and a market-value-weighted index.DECEMBER 31, 2011DECEMBER 31, 2012SharesSharesPriceOutstanding100,000,000Pr

The following computations are done to assess the change in index prices in different years.

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Accounting

2. Based on the following stock price and shares outstanding information, compute the beginning and ending values for a price-weighted index and a market-value-weighted index. DECEMBER 31, 2011 DECEMBER 31, 2012 Shares Shares Price Outstanding Price Outstanding Stock K 20 100,000,000 32 100,000,000 4,000,000 Stock M 80 2,000,000 45 Stock R 40 25,000,000 42 25,000,000 "Stock split two-for-one during the year. a. Compute the percentage change in the value of each index during the b. Explain the difference in results between the two indexes. c. Compute the percentage change for an unweighted index and discuss why these results year. differ from those of the other indexes.

2. Based on the following stock price and shares outstanding information, compute the beginning and ending values for a price-weighted index and a market-value-weighted index. DECEMBER 31, 2011 DECEMBER 31, 2012 Shares Shares Price Outstanding Price Outstanding Stock K 20 100,000,000 32 100,000,000 4,000,000 Stock M 80 2,000,000 45 Stock R 40 25,000,000 42 25,000,000 "Stock split two-for-one during the year. a. Compute the percentage change in the value of each index during the b. Explain the difference in results between the two indexes. c. Compute the percentage change for an unweighted index and discuss why these results year. differ from those of the other indexes.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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