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Worksheet 1 Answer Key

Posh Company purchased 10,000 shares of stock at ₱7.85 per share, paying a 8.5% brokerage fee of ₱6,672.50, for a total cost of ₱85,172.50. Posh later sold the shares at a higher price of ₱8.95 per share, paying a 4.5% brokerage fee of ₱4,027.50 and earning total proceeds of ₱85,472.50. Posh gained ₱300 from the trade.

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629 views

Worksheet 1 Answer Key

Posh Company purchased 10,000 shares of stock at ₱7.85 per share, paying a 8.5% brokerage fee of ₱6,672.50, for a total cost of ₱85,172.50. Posh later sold the shares at a higher price of ₱8.95 per share, paying a 4.5% brokerage fee of ₱4,027.50 and earning total proceeds of ₱85,472.50. Posh gained ₱300 from the trade.

Uploaded by

Aizia Sarceda Guzman
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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SH1612

Stock on You
Stocks and Bonds
1. Posh Company purchased 10,000 shares of John Calvin Corporation at ₱7.85 during the
opening of the trading day. If the brokerage fee is 8.5%, solve for the cost of buying the
stocks.
𝐶𝑜𝑠𝑡 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠 = 𝑞𝑢𝑎𝑛𝑡𝑖𝑡𝑦 𝑥 𝑝𝑟𝑖𝑐𝑒
𝐶𝑜𝑠𝑡 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠 = 10,000 𝑥 7.85
𝐶𝑜𝑠𝑡 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠 = ₱78,500
The total cost of the shares is ₱78,500.
𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒 = 𝐶𝑜𝑠𝑡 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠 ∗ 8.5%
𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒 = 78,500 𝑥 0.085
𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒 = ₱6,672.50
Based on the total cost of shares, the broker’s fee will be ₱6,672.50.
𝑇𝑜𝑡𝑎𝑙 𝐶𝑜𝑠𝑡 = 𝐶𝑜𝑠𝑡 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠 + 𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒
𝑇𝑜𝑡𝑎𝑙 𝐶𝑜𝑠𝑡 = 78,500 + 6,672.50
𝑇𝑜𝑡𝑎𝑙 𝐶𝑜𝑠𝑡 = ₱85,172.50
The total cost of the trade is ₱85,172.50.
2. Posh Company sold all the John Calvin Corporation’s 10,000 shares when the price is at
its high level at ₱8.95 per share and paid a brokerage fee of 4.5%. What was the net
proceeds from selling the stocks?
𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 = 𝑃𝑟𝑖𝑐𝑒 𝑝𝑒𝑟 𝑆ℎ𝑎𝑟𝑒 ∗ 𝑄𝑢𝑎𝑛𝑡𝑖𝑡𝑦
𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 = 8.95 𝑥 10,000
𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 = ₱89,500
The total proceeds from selling the stocks is ₱89,500.
𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒 = 𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 ∗ 4.5%
𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒 = 89,500 𝑥 .045
𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒 = ₱4,027.50
Based on the amount of proceeds, the broker’s fee will be ₱4,027.50
𝑁𝑒𝑡 𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 = 𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 − 𝐵𝑟𝑜𝑘𝑒𝑟 ′ 𝑠 𝐹𝑒𝑒
𝑁𝑒𝑡 𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 = 89,500 − 4,027.50
𝑁𝑒𝑡 𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 = ₱85,472.50
The total profit made from selling is ₱85,472.50.
3. Determine if Posh Company lost or gained in this trade.
𝐺𝑎𝑖𝑛/Loss = 𝑁𝑒𝑡 𝑃𝑟𝑜𝑐𝑒𝑒𝑑𝑠 − 𝑇𝑜𝑡𝑎𝑙 𝐶𝑜𝑠𝑡
𝐺𝑎𝑖𝑛/𝐿𝑜𝑠𝑠 = 85,472.50 − 85,172.50
𝐺𝑎𝑖𝑛/Loss = ₱300
Since the result is a positive number/amount, Posh Company gained/earned an
amount of ₱300.
5 points Complete solution with correct answer
RUBRIC:
4 points Last two major steps of the solution are incorrect
3 points Half of the solution is correct
2 points First two major steps of the solution are correct
1 point First major step of the solution is correct

08 Worksheet 1 Answer Key *Property of STI


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