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Luke Davis owned 150 shares of Sony 6.5% convertible preferredstock, $50 par value, for which he paid $56 per share, includingcommission. Two years later, after receiving preferred dividendseach year, he converted to 500 shares of Sony common stock, valuedat $22.50 a share at the time of conversion.a. What was the cost to Luke of the preferredstock?$b. How much did Luke receive in dividends fromthe preferred stock?$c. What was the value of the common stock thatLuke received?$d. If he sells the 500 common sharesimmediately, how much gain will Luke realize, including hisdividend?$e. What would be Luke's percent of gain? Roundyour answer to two decimal places.%
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