Mega Computer issued stock with a face value of one cent and then sold the shares to the public for $20.00 each.Ted bought 10 shares at that price.Today,Ted sold his shares to Deirdre for $25.00 each.What are Ted's capital gains?

Question

Quizplus · Accepted Answer

Ted's capital gains are calculated as the difference between the selling price and the purchase price, multiplied by the number of shares. He bought 10 shares at $20.00 each and sold them at $25.00 each, resulting in a gain of ($25.00 - $20.00) * 10 = $50.00.

Mega Computer Issued Stock with a Face Value of One