You are a financial investor who actively buys and sells in the securities market. Now you have a portfolio, including four shares: $7,500 of Share A, $4,800 of Share B, $5,700 of Share C, and $2,500 of Share D. Required: a) Compute the weights of the assets in your portfolio? (1 mark) b) If your portfolio has provided you with returns of 7.7%, 10.5%, - 8.7% and 14.2% over the past four years, respectively. Calculate the geometric average return of the portfolio for this period? (1 mark) c) Assume that expected return of the stock A in your portfolio is 13.2%. The risk premium on the stocks of the same industry are 6.8%, beta of this stock is 1.3. Calculate the risk-free rate of return using Capital market pricing model (CAPM). (2 marks)? d) You have another portfolio that comprises of two shares only: $500 Tesla shares and $700 Eagle shares. Below is the data of your portfolio: Tesla Eagle Expected return 13% 20% Standard Deviation of return 20% 45% Correlation of coefficient (p) 0.4 Compute the expected return of your portfolio. (1 mark) e) Compute the expected risk (standard deviation) of the portfolio. (2 marks) ANSWER:

Question 6 (7 marks) You are working as the finance manager for SamCo Ltd. The following data is available for the company as of 31 June 2021: Sales $2,586,500 Cost of goods sold 752,000 Wages and salary 125,750 Selling Expenses 45,300 Insurance expense 2,500 Utilities 12,500 Interest payment Depreciation Expense 32,000 Corporate Tax 30% 48,050 Required: a. Calculate operating profit, tax payment and build an income statement for the company? (3 marks) b. The company's Management Board required you to prepare a report about capital structure of the company. Name at least 4 financial ratios and their formulas, of which you need to discuss about financial leverage of the company in the report? (1 mark) c. Calculate the net profit margin (NPM) and total assets of the company given total assets turnover is 1.3. (2 marks) d. Calculate accounts receivable turnover of the company, given average accounts receivable is $98,000, assuming all sales are on credit? (1 mark)