You Have Bought 1000 Shares on Margin at $50 Per

question 73

Multiple Choice

You have bought 1000 shares on margin at $50 per share,putting up $25 000.The stock price has increased to $65.If the margin rate is 50 percent,how much more will the broker lend you?

• A)$0
• B)$15 000
• C)$7500
• D)$5000

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Definitions:

Weighted Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all units available for sale during the period.

Equivalent Units

A concept in cost accounting used to compute the costs associated with partially completed goods.

Welding Department

A specialized division within a manufacturing or engineering company focused on joining metal parts through the application of heat.

Weighted-Average Method

The weighted-average method calculates the cost of goods sold and ending inventory value, considering the average cost of all inventory items based on weight.