Julio Purchased 1,100 Shares of a Certain Stock for $26,750

question 36

Short Answer

Julio purchased 1,100 shares of a certain stock for $26,750 (including commissions). He sold the shares 5 year(s) later and received $32,500 after deducting commissions. Find the effective annual rate of return on his investment over the 5-year period. Round your answer to the nearest hundredth.
__________%

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Definitions:

Cash Account

A cash account is a brokerage account that requires the investor to pay the full amount for securities purchased and to receive full delivery of the securities sold.

Two-Column Journal

A fundamental accounting record with two columns used for debits and credits to record financial transactions.

Debit

An accounting entry that increases an asset or expense account, or decreases a liability or equity account. It is positioned on the left side of an account ledger.

Credit

An accounting entry that increases the balance of liabilities and equity accounts or decreases the balance of an asset or expense account.