Gary Bought a Share of Stock for $15

question 59

Multiple Choice

Gary bought a share of stock for $15.75 that paid a dividend of $.45 and sold three months later for $18.65.What was his dollar profit or loss and holding period return?

• A)$2.90,18.41%
• B)$3.35,21.27%
• C)-$2.90,-18.41%
• D)$.45,2.86%

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Definitions:

Prepaid Expense

Prepaid Expense represents payments made in advance for goods or services to be received in the future, recognized as an asset until the benefit is consumed.

Insurance Policy

A contract between an insurer and policyholder specifying the terms and conditions under which the insurer agrees to compensate the policyholder for specified losses.

Paid

Refers to the status of an account or invoice on which the due amount has been settled.

Adjusting Entry

A journal entry made in the accounting records at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.