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    Bartman Industries, Reynolds Inc., and the Winslow 5000 Index are analyzed over the period of 2009-2014. Annual rates of return, standard deviations, and coefficients of variation are calculated. Bartman had the highest average return and variation, while the Winslow 5000 had the lowest. Standard deviation measures risk, and coefficient of variation normalizes for return, showing Bartman had the riskiest returns relative to its average. The analysis provides insights into the relative risk and returns of the three portfolios over time.

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    Bartman Industries, Reynolds Inc., and the Winslow 5000 Index are analyzed over the period of 2009-2014. Annual rates of return, standard deviations, and coefficients of variation are calculated. Bartman had the highest average return and variation, while the Winslow 5000 had the lowest. Standard deviation measures risk, and coefficient of variation normalizes for return, showing Bartman had the riskiest returns relative to its average. The analysis provides insights into the relative risk and returns of the three portfolios over time.

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    Assign 2 CLO 3

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    DIVA RTHINI
    Bartman Industries, Reynolds Inc., and the Winslow 5000 Index are analyzed over the period of 2009-2014. Annual rates of return, standard deviations, and coefficients of variation are calculated. Bartman had the highest average return and variation, while the Winslow 5000 had the lowest. Standard deviation measures risk, and coefficient of variation normalizes for return, showing Bartman had the riskiest returns relative to its average. The analysis provides insights into the relative risk and returns of the three portfolios over time.

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    of 3

    FACULTY OF BUSINESS AND ACCOUNTANCY

    ASSIGNMENT 2

    COURSE : FINANCIAL MANAGEMENT

    COURSE CODE : PFS 1253

    PROGRAM : BACHELOR OF ACCOUNTANCY (HONS)

    LECTURER : MDM JAMILAH KAMIS

    Please fill the following particulars:

    NAME(S) :

    :
    STUDENT ID

    DATE :

    QUESTION Course Learning Outcome MARKS


    Calculate the time value of money, and to identify the
    CLO 3 relationship of risk and return (C2, PLO4)

    TOTAL /20
    FBA/PFS1253/ASSIGN2

    QUESTION 1

    Bartman Industries’s and Reynolds Inc.’s stock prices and dividends, along with the Winslow
    5000 Index, are shown here for the period 2009 – 2014. The Winslow 5000 data are adjusted
    to include dividends.

    Bartman Industries Reynolds Inc Winslow 5000


    Year Stock Price Dividend Stock Price Dividend Includes Dividends
    2014 $17.25 $1.15 $48.75 $3.00 $11,663.98
    2013 14.75 1.06 52.30 2.90 8,785.70
    2012 16.50 1.00 48.75 2.75 8,679.98
    2011 10.75 0.95 57.25 2.50 6,434.03
    2010 11.37 0.90 60.00 2.25 5,602.28
    2009 7.62 0.85 55.75 2.00 4,705.97

    Required:

    a. Use the data to calculate annual rates of return for Barman, Reynolds and Winslow 5000
    Index. Then calculate each entity’s average return over the 5-year period (hint: Returns
    are calculated by subtracting the beginning price from the ending price to get the
    capital gain or loss, adding the dividend to the capital gain or loss, and dividing the
    result by the beginning price. You cannot calculate the rate of return for 2009 because
    you do not have 2008 data. Refer to page 210).

    b. Calculate the standard deviation of the returns for Bartman, Reynolds and Winslow 5000
    Index.

    c. Calculate the coefficients of variation for Bartman’s, Reynolds’s and Winslow 5000
    Index.

    d. Discuss the results from the above for these three portfolios.

    2/CONFIDENTIAL
    FBA/PFS1253/ASSIGN2

    QUESTION 2

    Jane sold her house on December 31 and took a $10,000 mortgage as part of the payment. The
    10-year mortgage has a 10% nominal interest rate, but it calls for semiannual payments
    beginning next June 30. Next year Jane must report on Schedule B of her IRS form 1040 the
    amount of interest that was included in the two payments she received during the year.

    a. What is the dollar amount of each payment Jane receiving?

    b. How much interest was included in the first payment? How much repayment of principal
    was included? How do these values change for the second payment?

    c. How much interest must Jane report on Schedule B for the first year? Will her interest
    income be the same next year?

    d. If the payments are constant, why does the amount of interest income change over time?

    Note: Provide the amortization schedule.

    3/CONFIDENTIAL

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