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On January 1, you sold short one round lot (that is, 100 shares) of Lowe's stock...

On January 1, you sold short one round lot (that is, 100 shares) of Lowe's stock at $22.50 per share. On March 1, a dividend of $1.40 per share was paid. On April 1, you covered the short sale by buying the stock at a price of $17.50 per share. You paid 55 cents per share in commissions for each transaction.

a. What is the proceeds from the short sale (net of commission)?

b. What is the dividend payment?

c. What is the total cost, including commission, if you have to cover the short sale by buying the stock at a price of $17.50 per share?

d. What is the net gain from your transaction?

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jeff jeffy answered 2 years ago
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