$1$ Annual Return on Share Purchase

Hibba purchased $100$ shares of All$-$Canadian Manufacturing Company Stock at $$29\mathrm{.}50$ a share. One year later, she sold the stocks

for $$38$ a share. She paid her broker a $$34$ commission when she purchased the stocks and a $$42$ commission when she sold them.

During the $12$ months that she owned the stocks, she received $$184$ in dividends.

a$.$ Calculate Hibba$$s annual shareholder return $($Capital Gains $+$ Dividends$)$ and annual return $\%$

b$.$ Break this total return into its components: dividend yield and capital gains yield. $$

Solution: Sale of Shares

Share Purchase Proceeds of sale # shares X $$/$ share

Purchase cost of shares # shares X $$/$ share Commission paid on shares

Commission paid on shares Net Proceeds $($funds received$)$

Total Cost of Shares Annual Shareholder Return $=2\mathrm{.}0$

Capital Gain on Sale of Shares Dividend Income Annual Shareholder Return $\%=2\mathrm{.}0$

Funds received from sale $(=$ # Dividends X Dividend per share $)$

Less: Cost of shares Dividend Yield $\%=2\mathrm{.}0$

Gain on sale of shares Capital Gains

Capital Gains Yield $\%=2\mathrm{.}01$ Annual Return on Share Purchase

Hibba purchased $100$ shares of All$-$Canadian Manufacturing Company Stock at $$29\mathrm{.}50$ a share. One year later, she sold the stocks

for $$38$ a share. She paid her broker a $$34$ commission when she purchased the stocks and a $$42$ commission when she sold them.

During the $12$ months that she owned the stocks, she received $$184$ in dividends.

a$.$ Calculate Hibba's annual shareholder return $($Capital Gains $+$ Dividends$)$ and annual return $\%$

b$.$ Break this total return into its components: dividend yield and capital gains yield.