Question (32(15 marks) 1. At December 31, 2018 the adjusted trial balance of Dubai trading company shows the following balances: (5 Marks) Account Name Dr. Cr. Cash/capital 50,000 $ 135,600 Beginning inventory 10,000 Purchase goods/ sales revenue 60,000 78.000 Freight in 500 Freight out 600 Sales R&A/purchase R&A 9,800 4.500 Sales discount purchase discount 2,200 1,000 A/receivable /A/ payable 25,000 35.000 Salaries/salaries pay. 12.000 3.000 Prepaid insurance 15.000 Oil and gas expense 4.000 Supplies expense 6.000 Equipment/ accumulated depreciation 80,000 20,000 Rent expense 2.000 total 277.100 277,100 Required: 1. Compute the amount of net sales. 2. Compute the cost of net purchase 3. Compute the cost of goods available for sale (COGAFS). 4. Compute the cost of goods sold (COGS), given the cost of ending inventory $ 30,000 5. Compute the gross income or loss. 6. Compute net income or loss 7. Prepare multiple income statement Exhibit 9.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) Consider the three stocks, stock X, stock Y and stock Z, that have the following factor loadings (or factor betas). Stock Y Z Factor 1 Loading Factor 2 Loading -0.55 EEEEEEE 1.2 -0. 10 0 .85 TEATRO 035 03 TERRESTRE | The zero-beta return (70) 3%, and the risk premia are 2 = 10%, 22 -8%. Assume that all three stocks are currently priced at $50. 5. Refer to Exhibit 9.2. The expected returns for stock X, stock Y, and stock Z are? 6. Refer to Exhibit 9.2. The expected prices one year from now for stocks X, Y, and Z are? 7. Refer to Exhibit 9.2. If you know that the actual prices one year from now are stock X $55, stock Y $52, and stock Z $57, then which stock is overvalued, and which stock is undervalued? 8. Refer to Exhibit 9.2. Assume that you wish to create a portfolio with no net wealth invested. The portfolio that achieves this has 50% in stock X, -100% in stock Y, and 50% in stock Z. The weighted exposure to risk factor 1 for stocks X, Y, and Z are? 9. Refer to Exhibit 9.2. Assume that you wish to create a portfolio with no net wealth invested and the portfolio that achieves this has 50% in stock X, -100% in stock Y, and 50% in stock Z. The net arbitrage profit is? 10. Refer to Exhibit 9.2. The new prices now for stocks X, Y. and Z that will not allow for arbitrage profits are? Question (32(15 marks) 1. At December 31, 2018 the adjusted trial balance of Dubai trading company shows the following balances: (5 Marks) Account Name Dr. Cr. Cash/capital 50,000 $ 135,600 Beginning inventory 10,000 Purchase goods/ sales revenue 60,000 78.000 Freight in 500 Freight out 600 Sales R&A/purchase R&A 9,800 4.500 Sales discount purchase discount 2,200 1,000 A/receivable /A/ payable 25,000 35.000 Salaries/salaries pay. 12.000 3.000 Prepaid insurance 15.000 Oil and gas expense 4.000 Supplies expense 6.000 Equipment/ accumulated depreciation 80,000 20,000 Rent expense 2.000 total 277.100 277,100 Required: 1. Compute the amount of net sales. 2. Compute the cost of net purchase 3. Compute the cost of goods available for sale (COGAFS). 4. Compute the cost of goods sold (COGS), given the cost of ending inventory $ 30,000 5. Compute the gross income or loss. 6. Compute net income or loss 7. Prepare multiple income statement Exhibit 9.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) Consider the three stocks, stock X, stock Y and stock Z, that have the following factor loadings (or factor betas). Stock Y Z Factor 1 Loading Factor 2 Loading -0.55 EEEEEEE 1.2 -0. 10 0 .85 TEATRO 035 03 TERRESTRE | The zero-beta return (70) 3%, and the risk premia are 2 = 10%, 22 -8%. Assume that all three stocks are currently priced at $50. 5. Refer to Exhibit 9.2. The expected returns for stock X, stock Y, and stock Z are? 6. Refer to Exhibit 9.2. The expected prices one year from now for stocks X, Y, and Z are? 7. Refer to Exhibit 9.2. If you know that the actual prices one year from now are stock X $55, stock Y $52, and stock Z $57, then which stock is overvalued, and which stock is undervalued? 8. Refer to Exhibit 9.2. Assume that you wish to create a portfolio with no net wealth invested. The portfolio that achieves this has 50% in stock X, -100% in stock Y, and 50% in stock Z. The weighted exposure to risk factor 1 for stocks X, Y, and Z are? 9. Refer to Exhibit 9.2. Assume that you wish to create a portfolio with no net wealth invested and the portfolio that achieves this has 50% in stock X, -100% in stock Y, and 50% in stock Z. The net arbitrage profit is? 10. Refer to Exhibit 9.2. The new prices now for stocks X, Y. and Z that will not allow for arbitrage profits are
