Kwon-Lee sold 200 shares held in FNP Mutual Fund in 2017 for $22,500 and received a 1099-B to record the sale of the shares.Kwon-Lee's investment portfolio includes the following purchases of FNP Mutual Fund stock: $\begin{array}{rr}
2005 & 100 \text { shares at } \$ 100 \text { per share } \
2009 & 50 \text { shares at } \$ 110 \text { per share } \
2013 & 125 \text { shares at } \$ 130 \text { per share } \
2013 & 75 \text { shares at } \$ 125 \text { per share }
\end{array}$ Assuming Kwon-Lee uses the single category average cost method,he will recognize

Question

Quizplus · Accepted Answer

The average cost per share is calculated as the total cost of all shares divided by the total number of shares: $(100 \times 100 + 50 \times 110 + 125 \times 130 + 75 \times 125) / 350 = \$118.57$. The cost of 200 shares is $200 \times 118.57 = \$23,714$. The sale was for $22,500, resulting in a loss of $1,214, rounded to $1,000 loss.

Kwon-Lee Sold 200 Shares Held in FNP Mutual Fund in 2017