Question

Four months ago, you purchased 900 shares of LBM stock for $7.68 a share. Last month, you received a dividend payment of $0.12 a share. Today, you sold the shares for $9.13 a share. What is your total dollar return on this investment?

a. $1,305
b. $1,413
c. $1,512
d. $1,394
e. $1,080

Answer 1

Answer:

b. $1,413

Explanation:

Total Purchase Value = 900 x $7.68 = $6,912

Dividend received = 900 x 0.12 = $108

Total Purchase Value = 900 x $9.13 = $8,217

Total return on share = Dividend received + Gain on sale of shares

Total return on share = $108 + ( 8,217 - 6,912 )

Total return on share = $108 + $1,305

Total return on share = $1,413