An investor purchased 500 shares of common stock, $25 par, for $21,750. subsequently, 100 shares were sold for $49.50 per share. what is the amount of gain or loss on the sale?
We are tasked to determine whether there is a gain or a loss. The solution is shown below: Cost basis: $21,750 / 500 shares = $43.5 For 100 shares, we have: Cost basis for 100 shares = $43.5 * 100 = $4350
Perform subtraction: Gain or Loss = Sales - Cost Gain or loss = ($49.50 *100 shares) - $4350 Gain or loss = $4950 - $4350 Gain or loss = $ 600
