Memorizing Important Formulas for the Series 7 Exam

Series 7 Exam: 1001 Practice Questions For Dummies

You can’t bring your notes into the Series 7 exam center, so be sure to stow the following info away in your brain and write it on the scrap paper provided after the test begins:

Determine the outstanding shares

Outstanding shares = issued shares – treasury stock

Long margin account formula

Long market value (LMV) – debit record (DR) = equity (EQ)

Short margin account formula

Short market value (SMV) + equity (EQ) = credit record (CR)

Calculate the time value of an option

Premium (P) = intrinsic value (I) + time value (T)

Balance sheet formula

Assets = liabilities + stockholder’s equity

Calculate working capital

Working capital = current assets – current liabilities

Calculate the time value of an option

Premium (P) = intrinsic value (I) + time value (T)

About This Article

About the book author:

Steven M. Rice is a partner in Empire Stockbroker Training Institute, one of the country’s leading schools for securities industry training. He is also an instructor at Empire, and his upbeat training style, entertaining sense of humor, and extensive knowledge are highly regarded by his students. Rice also is the author of Series 7 For Dummies.