Beverly Frickel purchased 100 shares of Gleason Systems stock for $42.50 per share. Her commission for this purchase was $35. She sold the stock two years later for $55 per share and a commission of $50. While she held the stock it paid a dividend of $1.50 per share. What was Beverly's total dollar return on this stock?

Question

Quizplus · Accepted Answer

To calculate Beverly's total dollar return, we need to calculate the following:

1. Total cost of purchasing the stock = 100 shares x $42.50 per share + $35 commission = $4,310
2. Total cost of selling the stock = 100 shares x $55 per share - $50 commission = $5,450
3. Dividends received while holding the stock = 100 shares x $1.50 per share x 2 years = $300

Therefore, Beverly's total dollar return on this stock is:

Total dollar return = Total cost of selling the stock - Total cost of purchasing the stock + Dividends received
= $5,450 - $4,310 + $300
= $1,440

Therefore, the answer is D) $1,315.

Beverly Frickel Purchased 100 Shares of Gleason Systems Stock for $42.50