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Compute Gerber Ltd new cost per share

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Reference no: EM132751034

Question - Gerber Ltd. buys 2,000 of the 100,000 shares of Efron Inc., paying $35.00 per share. Suppose Efron distributes a 10 percent stock dividend. Later the same year, Gerber Ltd. sells the Efron shares for $29.00 per share. Disregard commissions on the purchase and sale.

Required -

1. Compute Gerber Ltd.'s new cost per share after receiving the stock dividend.

2. Compute Gerber Ltd.'s gain or loss on the sale of this long-term investment.

Reference no: EM132751034

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