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23 May, 21:36

Acutron is a large securities dealer. Last year, the company made 240,000 trades with an average commission of $240. Because of the general economic climate, Acutron expects trade volume to decline by 20%. Fortunately, the average commission per trade is likely to increase by 10% because trades are expected to be large in the coming year. What are the estimated commission's revenues for Acutron in the coming year

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  1. 23 May, 21:57
    0
    Estimated commission revenues is$$50,688,000.00

    Explanation:

    The estimated commission revenue for Acutron in the coming year reflects last year's volume of trade less 20% decline multiplied by the average commission for last year adjusted for 10% increase

    volume of trade=240,000 * (1-20%)

    =240,000*0.80

    = 192,000 trades

    average commission per trade=$240 * (1+10%)

    =$240*1.1

    =$264

    Estimated commission revenue=quantity*price

    =192,000*$264

    =$50,688,000.00
  2. 23 May, 23:40
    0
    The estimated commission's revenues for Acutron in the coming year will be $ 50,688,000.

    Explanation:

    In order to calculate the estimated commission's revenues for Acutron in the coming year we have to proceed first to following steps:

    Step 1: We have to calculate the estimated trade

    estimated trade = 240,000 * 80%=192,000 Trade

    Step 2: We have to calculate the estimated commission per trade

    estimated commission per trade = 240*110%=264

    Finally we can calculate the estimated commission's revenues

    estimated commission's revenues=192,000*264 = $ 50,688,000.
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