Financial Risk Manager Part 2

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Explanation:

If the receipt was at the beginning of the period, then:

\left\{ \frac{[6,400,000 - (4,700,000 + 800,000)]}{[4,700,000 + 800,000]} \right\} = 0.1636 \text{ or } 16.36\%

If the receipt was at the end of the period, then the 800,000 contribution should not taken into account when calculating the return earned over the past year as it already forms part of the 6,400,000:

\left\{ \frac{[(6,400,000) - 4,700,000]}{[4,700,000]} \right\} = 0.3617 \text{ or } 36.17\%

Explanation:

If the receipt was at the beginning of the period, then:

\left\{ \frac{[6,400,000 - (4,700,000 + 800,000)]}{[4,700,000 + 800,000]} \right\} = 0.1636 \text{ or } 16.36\%

\left\{ \frac{[(6,400,000) - 4,700,000]}{[4,700,000]} \right\} = 0.3617 \text{ or } 36.17\%

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Q.3172 The Campbell family trust account had a value of `$4`,700,000 on April 1st 2017 and `$6`,400,000 on April 1st 2018. During the year, a contribution of `$800`,000 was received but the trust manager did not note the date on which the contribution was received. Assuming that the fund values are given as end-of-day values, what would be the rate of return on the account if the contribution was received on April 1st 2017 versus if it were received on April 1, 2018?

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Last updated: July 5, 2026 at 07:23

April 1, 2017: 19.14%; April 1st, 2018: 16.36%

April 1, 2017: 19.14%; April 1st, 2018: 14.06%

April 1, 2017: 14.06%; April 1st, 2018: 15.98%

April 1, 2017: 16.36%; April 1st, 2018: 36.17%