Important Dollar Amounts, Percentages, and Formulas

Question 1

Exempt from Registration:

Answer 1

Rule 144 – Public resale of restricted and control securities under certain conditions. Rule 147 – Intrastate offerings, Reg A – small issue, Reg D (private placements. Rule 504 – raise up to $10M and sell to up to 35 non-accredited. Rule 506c – purchases to accredited ONLY), and Reg Crowdfunding (raise up to $5M)

Question 2

Insider Trading penalties

Answer 2

three times the profit made or losses avoided. A BD or RR could be fined up to $2M or three times the profit or loss, whichever is greater. Criminal penalties up to $5M and 20 years in jail (BD three times the damages or $25M, whichever is greater

Question 3

Maximum 12b-1 fee for a no-load fund

Answer 3

0.25%

Question 4

maximum 12b-1 fee for loaded fund

Answer 4

1%

Question 5

maximum sales charge for open-end (mutual fund) company

Answer 5

8.5%

Question 6

penalty for insufficient IRA distribution after age 73

Answer 6

50%

Question 7

Municipal Member Firms and elections

Answer 7

Not allowed to contribute. RR allowed to contribute up to $250. Violation for both is two years

Question 8

Institutional communications apply to any entity with

Answer 8

$50M or more of total assets

Question 9

SIPC Coverage

Answer 9

$500K per account, including up to $250K in cash

Question 10

Reg D Family Office must have

Answer 10

$5M in AUM to qualify as accredited investor

Question 11

A company’s equity or net worth =

Answer 11

assets – liabilities. Accounts receivable are not long term assets

Question 12

Working Capital =

Answer 12

current assets – current liabilities

Question 13

Current ratio (used to measure liquidity) =

Answer 13

current assets/current liabilities (eg 2:1 or 1.25:1)

Question 14

Acid Test ratio (Quick Ratio) =

Answer 14

(current assets – inventory)/current liabilities

Question 15

Debt ratio (debt-to-equity ratio) measure of long-term solvency =

Answer 15

long-term debt/(long-term debt + net worth)

Question 16

P/E =

Answer 16

CMV of share / EPS

Question 17

IRA owner penalty free withdrawal for childbirth or adoption expenses up to

Answer 17

$5K

Question 18

Options Premium =

Answer 18

Time value + intrinsic value

Question 19

Requirements for SAR/CTR?

Answer 19

greater than $5K in a day, WITHIN 30 days. Also the record must be held for five years / Greater than $10K in a day, CTR within 15 days

Question 20

Buy stop limit order: Buy XYZ 200 shares 20 stop 19

Answer 20

Order triggered at or above 20 and filled at 19 or lower

Question 21

How is a bond quoted?

Answer 21

Par value is $1000, quoted as 94.20, with the decimal in 32nds

Question 22

Preferred stock par value is

Answer 22

$100

Question 23

Minimum amount of equity for first purchase in a margin account:

Answer 23

Reg T 50%, FINRA the lesser of $2000 or 100%. >$4000, deposit 50%. $2000<X<$4000, deposit $2000. <$2000 deposit 100%

Question 24

Rule 144

Answer 24

Affiliate needs to file a Notice of Proposed sale with the SEC if the sale involves more than 5,000 shares

Question 25

CY or Dividend Yield =

Answer 25

annual income (dollars) / current market value. Ex: 6% preferred stock ($100 par) is trading at $120 share. Dividend yield is $6 / 120 = 5%

Question 26

Do dividends factor into capital gains?

Answer 26

No! Only into total return and income

Question 27

Example of a quote: 12.00-12.10 [25x10] – buy 2500 shares at 12 and sell 1000 shares at 12.10

Answer 27

Nice! Lol!

Question 28

How much can a donor give to a UGMA?

Answer 28

Unlimited amount of cash!

Question 29

How much can be withdrawn from a 529 to pay for a student loan?

Answer 29

$10K